MIA Financial Services mortgage broker Mary Gonzo said a tightening of credit policies by the banks is to blame for a dip in the real estate market.

“Lending was fairly strong last year because the grant (first home buyers grant) was still $10,000 but since it was reduced on the 1st of January the market has dropped off,” Ms Gonzo said.

“We saw it slow down into February due to the lending institutions tightening their credit policies and obtaining finance at the moment has been harder than it has been in previous years, particularly for young buyers.”

Griffith Real Estate property specialist Brendan Catanzariti said the reduction in the home buyers grant, the restrictions on lending criteria and the recent interest rate rise have caused a buyer drought in the Griffith real estate market.

Ironically, this drought is pushing prices down as more and more properties go on the market creating a “buyers’ market”, Mr Catanzariti said.

“Griffith has always been a market where housing prices generally increase but in the current climate we’re looking at heading back to the 2008 market where we had the worst recorded prices in a decade,” he said.

“It’s a great market for buyers, if there were any, but they’re a bit like the Tassie tiger at the moment; a rare sight.”

Perhaps the reason for the buyer drought in town is that residents are preferring to buy outside the Griffith market.

“Outside investments have definitely picked up. I’m doing about three at the moment who are buying property in the cities,” Ms Gonzo said.

But all predictions are not bad as Ms Gonzo said the market is dominated by second home buyers looking to build, which will boost the local building economy.

Bowman and Graham First National director David Graham said they had recorded some very positive sales over the past two months.

“October, November and December were bad months for us,” Mr Graham said.

“We only sold four over that period where we try and sell four a month. But this year the market’s picked up and we sold 12 over January and February.”