Revelations from Mortgage Choice 2011 Recent First Homeowner Survey

Mortgage Choice has announced the results of its annual survey of recent first homebuyers, noting that almost one in five respondents have taken on significant additional debt in the first two years since purchasing a home.

For 5% of respondents, this additional debt amounted to more than $100,000. The mortgage brokers also found that over one quarter of new homeowners do not know their home loan’s interest rate.

Conducted online from the 8th to 17th February, the survey attracted responses from 803 Australians who had purchased their first home in the past two years.

Not all news was negative, with 83% of new homeowners reporting no regrets about their purchase and 63% making higher than necessary loan repayments, with 33% of these contributing as much as they could, and leaving it in the account to offset the interest owed.

64% confirmed that they will keep the property as an investment after they move.

Spokesperson for Mortgage Choice mortgage brokers, Kristy Sheppard, says that “Australia has a very low mortgage arrears rate and it’s likely this group of buyers will help us to maintain this position.”

Although respondents to this year’s survey were older at the time of purchase than those surveyed last year, and a higher proportion made lifestyle sacrifices in order to buy, Ms Sheppard notes that the vast majority were satisfied with their purchase, and had a sound repayment strategy.

One factor of concern, she says, is the significant number of respondents that had taken on additional debt within the first two years after purchasing their first home.

These results, Ms Sheppard adds, “go a long way to demonstrating how mortgage stress is very often caused by the additional debt people commit to after they take out their mortgage.”