Bankwest Executive General Manager, Retail, Andrew Whitechurch said: “Low interest rates, sluggish wage growth, and rising house prices are making it increasingly difficult for first time buyers to get a foot on the property ladder in most capital cities in Australia.
“Australia’s median house value grew 3.9% to $518,000 in the 12 months to June 2016, while variable-lending rates on owner occupier housing loans are notably lower than the 10-year average rate of 6.93%.
“We’ve seen extremely strong growth in property values in Sydney and Melbourne, while wages have grown by just 2.2% cent nationally.”
Longest savings wait in Australia
Of the top 10 local government areas (LGAs) nationally where it takes longest for FTBs to save a house deposit, eight are in Sydney.
The top two areas are Strathfield (17.9 years, $410,800) and Mosman (17.4 years, $613,000).
Other key findings from the Bankwest Financial Indicator Series’ First Time Buyers Deposit Report 2016, include:
- The number of FTBs declined to 90,939 in the year to June 2016, down from 94,517 the previous 12 months
- Three of the top 10 LGAs with the shortest saving times for FTBs to buy a house are in QLD and NSW respectively, two in SA, one in WA and one in Tasmania
- Regional and rural LGAs offer the quickest pathway to a first home. Nationwide, three in 10 LGAs require the average FTB couple to save for more than four years for a deposit on a median priced house. Of these 141 LGAs, 111 (78.7 per cent) are located in the capital cities
- The market for units is more accessible for FTBs than the housing market. On average, it takes 3.5 years for FTB couples to save a 20 per cent deposit on a median priced unit in Australian capital cities, and 1.4 years less than it takes to save for a house in the capital cities
- The top 10 longest unit saving times are all in NSW. Nationwide, Manly is the LGA where it takes longest for an FTB couple to save a unit deposit (8.3 years), followed by Burwood (7.5 years) and Sydney (7.1 years).
For more information on the report, click here.