Kelvin Davidson: Cotality Chief Property Economist on the average age of first home buyers rising

The average first home buyer is getting older.  

A Cotality-Westpac report has found the average age of first home buyers has increased to 36 nationwide.  

It's 37 in Auckland, 36 in Wellington, and 35 in Christchurch – all figures are two or three years higher than average in 2019. 

Cotality Chief Property Economist Kelvin Davidson told Mike Hosking there’s a range of reasons behind it. 

He says the affordability measures aren’t much different than they were in 2019, so while affordability is an influence, lifestyle and career choices are definitely having an impact. 

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Episode Transcript

Speaker 1 (00:00):
Got some good news I think around housing. You report
this morning shows it's nearly a quarter twenty five percent
of all purchases were first home buyers. Interestingly, the average
age for these first time buyers is up. It's now
thirty six.

Speaker 2 (00:10):
Now.

Speaker 1 (00:10):
Kelvin Davidson is Cautality Chief Property Economists and is back
with this is Calvin morning to you.

Speaker 2 (00:16):
Good morning.

Speaker 1 (00:17):
Twenty five issues a pretty steady sort of number, I think,
isn't it.

Speaker 2 (00:20):
Yeah, that's yeah. I mean the average historically is about
twenty one twenty two, so yeah, twenty five pretty solid.
They have been up as high as twenty seven, but yeah,
still doing pretty well at twenty five. So decent market
for first home buyers.

Speaker 1 (00:32):
Exactly what's the investor mix at the moment in terms
of competition for a first home buyer? Are they back
or not?

Speaker 2 (00:38):
Yeah, investors are definitely coming back. They've risen for about
twenty percent up to twenty three twenty four, so I
don't know. I think it's pretty balanced at the moment.
I mean, there's opportunities for first home buyers, but investors
are coming back in just rights down and interesteductibility back
to one hundred percent. Yeah, I think there's a bit
for everyone.

Speaker 1 (00:57):
Access to money. I'm reading it increasingly. You can get
you know, low deposits, there are deals to be done,
et cetera. Is all of that true.

Speaker 2 (01:04):
Yeah, I think that's right as well. I mean there's
a sense of galance across lots of parts of the
hours in market. Certainly money is available. Yes, you've got
to get as fire serviceability testing and obviously have the
deposit that sort of thing. Deposits are you can get
in with low deposit, as you say, so your money's available.
People can get in as they meet the criteria.

Speaker 1 (01:22):
And there's talk also I'm reading of delays on processing
with various banks. Does that mean the demand is up
and there falls a Q forming.

Speaker 2 (01:30):
Yeah, I think that's That's one of the issues that
I hear quite a bit, and partly it's just sort
of a legacy thing everyone wins on. Think back to
the end last year. The Reserve Bank made a big
ot our decision in November. Around about that time, everyone
stayed floating and then after the decision decided to fix
the six months you know, fixing short as they could.
Now that's six months roll forward. We're pretty much there now.

(01:52):
So there's this big wave of repricing the banks having
to deal with right now, so resources are spread just
a little bit thin.

Speaker 1 (02:00):
Now this first time by a rage. I was saying
earlier on if you'd asked me to guess, I would
have said twenty nine to thirty one, hand on heart.
What would you have said if you didn't have knowledge
of the data?

Speaker 2 (02:11):
Well, yeah, good question, because I always do hard to say.
I mean, yeah, I would have said, perhaps on the
first half of the thirties that these figures come from
West Pax morgigely any records. So it's real data. It's
it's hard data, it's what people are actually doing. So yeah,
up to thirty six, it's part of a long term
upwards trend has got harder. But I think people are

(02:31):
making lifestyle choices to thee all that sort of thing. Exactly.

Speaker 1 (02:34):
I'm glad you said that, because I just wonder how
much of it is Like everyone. You could look at
thirty six and go, see, can't afford it, or you
could look at thirty six and go, Yep, I've done
a whole bunch of other stuff because I decided that's
what I want to do with life.

Speaker 2 (02:48):
Yeah, I think there's a mix of it at the moment.
If you look at affordability, so these numbers have gone
up from thirty four in twenty nineteen to thirty six now.
Now if you look at affordability measures right now compared
to twenty nineteen, actually not that much different exactly. I
mean they were very very very stretched to or three
years ago, but compared to six years ago, they're not
that much different. So I think this a way bit

(03:09):
of affordability, but also your lifestyle choices, you build your career,
you go on the OE, all that sort of stuff.

Speaker 1 (03:14):
First, good insight, Calvin, enjoy your company, Kelvin Davidson, who's
the chief property economisty at Totality These days.

Speaker 2 (03:23):
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