National story of property prices is not reflective of many markets in Australia

PHOTO: Realestate.com.au chief economist Nerida Conisbee believes there are other factors in play for investors. Picture: AAP image / Monique Harmer Source: News Corp Australia

Australia’s insane property prices have created some pretty big losers – and it is not just the younger generations missing out.

Australian property prices are still among the highest in the world compared with income, with Sydney and Melbourne’s real estate prices particularly soaring.

For this reason, the Government has introduced a range of new initiatives to help Australia’s younger generations get their foot in the door.

One of those initiatives, the First Home Loan Deposit Scheme, allows for 10,000 eligible homebuyers to purchase their first property with a 5 per cent deposit – instead of the usual 20 – thanks to the Government guaranteeing the mortgages.

That scheme kicked off this year, but it was, in fact, last year that marked the biggest surge in first-home buyers on the market.

However, CoreLogic research director Tim Lawless told news.com.au the surge of new buyers would not last, particularly as investors retturned to the market.

Mr Lawless said as property prices climbed, investors would return as there was money to be made.

“Investor activity is likely to ramp up as the prospects for capital gain start to become more widespread and the spread between rental yields and mortgage rates remains around record lows,” he said.