First-time home buyers are rushing to market to take advantage of the federal government’s increased grant scheme. According the Australian Bureau of statistics, first-home buyers comprised 26.5% of loans granted for owner-occupied homes.

January numbers were the highest recorded since 1991. It follows the same positive trend as the last three months, growing 3.5% month-on-month with a total of 55,628 loans financed. Total housing finance value increased by 0.7% amounting to $18.88 billion.

The increase in grants were triggered in October by Prime Minister Kevin Rudd and is due to end in June. It is part of the $10.4 billion government stimulus package would help Australia counter the global economic crisis. The government said it would invest about $1.5 million in the housing market. The first home buyers scheme was double from $7,000 for purchase of existing properties, to $14,000. Meanwhile, those buying new homes received an extra $14,000, increasing their maximum to $21,000.

According to ANZ economist Alex Joiner, the real estate market is still experiencing a rush despite falling housing prices and low interest rates. “There is an opportunity to enter the property market now and that is why housing finance approvals are still rising,” says Joiner.

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