subject: Consumer Insight - Mortgages In Australia - Market Research Report On Aarkstore Enterprise [print this page] Introduction Introduction
In 2010 Datamonitor will release two mortgage reports, splitting the content between consumer insight and market analysis. This report focuses on consumer insight issues, including consumer outlook, mortgagor satisfaction and lender brand image. Later in the year, a market report will focus on market shares, product analysis and forecasts.
Scope
*Provides data on consumer outlook and mortgage intentions.
*Draws upon a large Datamonitor consumer survey to gain insights into the current mindset of the Australian mortgagor.
*Provides an overview of changes in mortgage satisfaction and brand image.
*Analyzes different segments of mortgage demand.
Highlights
The future direction of Australian property prices is currently hotly contested, with some economists predicting a crash and others forecasting steadily rising prices over the next year, with a major reason for these divergent opinions being the presence of two strong opposing forces of affordability and undersupply.
There are several product innovations that promise to help mortgage affordability in the face of rising property prices. These include shared equity mortgages (SEMs), mortgages with longer loan terms, and shared mortgages.
Most economic observers and industry participants have relatively low forecasts of first time buyer and investor activity over the next 12 months. However, there are indications that the market may be underestimating demand from these two segments
Reasons to Purchase
*Plan your future strategy with confidence using Datamonitors in-depth consumer survey data.
*Understand the outlook and attitudes of your potential customers in the mortgage market.
*Track and benchmark brand image and satisfaction ratings.
Table of Contents :
Overview 1
Catalyst 1
Summary 1
Executive Summary 2
Consumer outlook shapes mortgage demand 2
Consumer outlook has recovered 2
Consumer confidence in employment is an especially important factor for mortgage demand 2
Consumers do not expect interest rates or property prices to fall over the next 12 months 2
Choice of fixed or variable rate mortgages is driven by rate expectations and consumer confidence 2
Upgraders and refinancers have become a prime segment for mortgage lenders 3
Mortgagors looking to upgrade or refinance have distinct characteristics 3
Despite consensus about low forecasts, first-time buyers and investors may surprise the market 3
Different demographics have different mortgage attitudes 4
Housing affordability and undersupply are currently key factors for the mortgage market 4
Housing undersupply is chronic in some areas of Australia 4
Housing undersupply in certain areas can be ameliorated by upgraded transportation 4
Unused housing and unused land could provide a buffer against housing undersupply 4
Households have fewer people and dwellings have grown larger 5
House prices have increased faster than wages and housing costs claim a higher proportion of income 5
Government efforts to solve affordability issues have been criticized for not addressing the supply side 5
Younger demographics are now less likely to own or expect to own property 5
Realistic buyer expectations could help affordability 5
There is a limit to how high housing costs can go as a proportion of income 5
Price correction 6
Increase in renting and fewer homeowners 6
Product innovation 6
Provider brand attitudes are in flux 6
Brand images vary by bank 6
Mortgage satisfaction has improved over the last year 7
NAB is attempting to reverse its image 7
Credit unions are switching their proposition from service to price 7
CBA and Westpac are pursuing multibrand strategies 7
TABLE OF CONTENTS 8
Table of figures 9
Table of tables 10
Consumer Outlook Shapes Mortgage Demand 11
Consumer outlook for property prices, interest rates, and the job market are central to mortgage demand 11
Consumer outlook has recovered 11
Consumer confidence in employment is an especially important factor for mortgage demand 13
Consumers do not expect interest rates or property prices to fall over the next 12 months 15
Choice of fixed or variable rate mortgages is driven by rate expectations and consumer confidence 16
Demand can be segmented in different ways 18
The majority of property and mortgage demand will come from consumers who already hold a mortgage 18
Upgraders have become a prime segment for mortgage lenders 19
Refinancers are also expected to make up a larger proportion of the mortgage market 19
Mortgagors looking to upgrade or refinance have distinct characteristics 21
Despite consensus about low forecasts, first-time buyers and investors may surprise the market 26
Different demographics have different mortgage attitudes 28
Housing Affordability and Undersupply are Currently Key Factors for the Mortgage Market 33
Undersupply and affordability have complex links 33
Housing undersupply is chronic in some areas of Australia 34
New construction has failed to meet the demand for new housing 34
Housing undersupply in certain areas can be ameliorated by upgraded transportation 36
Unused housing and unused land could provide a buffer against housing undersupply 36
Households have fewer people and dwellings have grown larger 37
Housing affordability has steadily declined over the last decade and is set to deteriorate further 38
House prices have increased faster than wages and housing costs claim a higher proportion of income 38
Government efforts to solve affordability issues have been criticized for not addressing the supply side 40
Younger demographics are now less likely to own or expect to own property 40
Realistic buyer expectations could help affordability 41
There is a limit to how high housing costs can go as a proportion of income 43
Price correction 43
Increase in renting and fewer homeowners 43
Product innovation 43
Provider Brand Attitudes are in Flux 45
Brand image and customer satisfaction are ongoing issues for providers 45
Brand images vary by bank 45
Mortgage satisfaction has improved over the last year 48
Several major brand realignments are currently taking place 49
NAB is attempting to reverse its image 50
Credit unions are switching their proposition from service to price 52
CBA and Westpac are pursuing multibrand strategies 52
