Should first home buyers be rushing to buy a property?

PHOTO: First home buyers

Plenty of first home buyers are desperate to buy property right now.

After around a year of declines the property market has suddenly swung back to boom times. In the three months to October 2019 national property prices rose 2.9%, combined capital prices increased by 3.6%, Sydney prices went up 5% and Melbourne prices jumped 5.5%.

Not every city is seeing such a strong recovery, but it certainly seems that the bad times have passed. I can imagine the management of Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), Australia and New Zealand Banking Group (ASX: ANZ), National Australia Bank Ltd (ASX: NAB), REA Group Limited (ASX: REA) and Domain Holdings Australia Ltd (ASX: DHG) are pleased by this.

I can totally understand why some first home buyers are fearing they won’t be able buy property unless they jump in now.

But for anyone who’s thinking about buying it’s hard to know what to do. Should people try to buy even if they don’t have a deposit? Should they still aim for a 20% deposit even though it’s a moving-upwards target? Should people come to terms with long-term renting instead?