A new study by Finder has unveiled the stark reality of the Australian property market, revealing that it could take a staggering two decades for the average household to save enough for a home in New South Wales. For a unit, the time needed to save is slightly less, but still a significant 16 years.
The team at Finder arrived at these numbers by analysing the average weekly earnings across the country, taking into consideration the median house prices and assuming that households are able to save 25% of their income after accounting for essential expenses such as rent, food, utilities, internet, phone and transport costs.
The study also factored in an annual property price growth of 3.5%, an average savings interest rate of 3%, and a 3.5% annual growth in median household income. Based on these parameters, the study concluded that first-time home buyers would need to accumulate an average of $299,868 for a house deposit and $188,523 for a unit.
Richard Whitten, Finder’s home loans expert, commented on the findings stating that they underscore how home ownership is becoming increasingly elusive for many Australians. “The rate of wage growth over the past few decades has not kept pace with the exponential rise in property prices,” he said. “The challenge of saving enough for a deposit is further compounded by the rising cost of living – from food and energy to insurance and rent.”
The study also highlighted that it is most challenging to buy a home in NSW, where the average household would need to save for approximately 20 years to accumulate a house deposit of $470,660. Tasmania ranks as the second most challenging place to save for a house, with households needing 17 years worth of savings – $226,098 – for a house deposit.
Contrastingly, the Northern Territory emerged as the most accessible place in Australia to buy a property, with only six years of saving needed for a unit and eight years for a house.
For those seeking help buying in Sydney or considering employing the services of a Sydney Buyers Agent, these figures underline the importance of careful financial planning and strategic saving. A Northern Beaches Buyers Agent can provide valuable advice and guidance in navigating this challenging market.
Moreover, first-time buyers or those considering moving to a new area might also benefit from engaging a Buyers Agent Lower North Shore. These professionals can provide insights into market trends, offer advice on potential investment opportunities, and help negotiate deals that could potentially shorten the time needed to save for a home.
In conclusion, while the Finder study paints a sobering picture of Australia’s property market, it also highlights the importance of strategic financial planning and professional advice when it comes to home buying. Whether you are a first-time buyer or looking to invest in property, consider seeking professional advice to understand your options better and make informed decisions.