Aussies Buying Homes on Lower Interest Rates

Investors are about 70 percent of visitors at broker Andrew Ienna’s open houses in Sydney’s western suburbs as low borrowing costs lift returns on rentals, and high prices and down payments scare off first-time buyers.

The value of home-loan approvals for investors rose 4 percent in December from a year ago in seasonally adjusted terms, while mortgages for owner-occupiers fell 1.8 percent in the same period, government data show.

From Sydney’s inner suburbs to the mining towns of Western Australia, investors are taking advantage of the lowest mortgage costs since 2009 to profit from a national vacancy rate that has been below 2 percent for more than three years. The number of suburbs where it’s cheaper to buy a home on a variable rate mortgage than to rent rose to 494 in December from 388 two months earlier, figures from researcher RP Data show.

Bloomberg

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