Cashed-up baby boomers take advantage of perceived bargains in the property market, Veda Advantange says. It reports that mortgage applications were up 38% in March, compared to the same month last year. It says these were the highest monthly total since November 2007.
Baby boomers (44-62 years old) in particular appear to be showing a disproportionate interest in the housing market with a 45% increase in mortgage applications on March 2008. Generation X (28-43 years old) experienced a 34% increase, while Generation Y (less than 28 years old) had the smallest growth with a 16% increase on March last year.
"The March statistics show a growing surge of renewed interest in the housing market during the first quarter of 2009," Veda Advantage New Zealand managing director, John Roberts, says. "February grew by 37% on January, with momentum continuing into March with a further jump of 29% over the preceding month."
He says there is a level of activity in mortgage applications that hasn't seen since house prices began falling in late 2007.
"This activity reflects the lower interest rates stimulating demand, and shows the market going to fixed terms to lock in these rates.
“The much larger increase in the number of baby boomers applying for mortgages, compared to younger age groups, suggests that they are more cashed up and in a better position to snap up perceived bargains in the housing market.
"The fact that applications from Generation Y have increased only marginally over March 2008, may be a result of the tighter rules by lenders regarding minimum deposits.”