While it’s no secret Australian house prices are skyrocketing — jumping by $1,200 a day in Sydney in April and June this year — not much has been said about how long it takes to save up to get into the property market these days. Until now, that is.
New research conducted by comparison website Canstar and reported by realestate.com.au found that, in the current property market, it would take the average Sydney first-home buyer 15 years (well, 14 years and 10 months) to save up enough for a 20% house deposit. The number had increased by a whopping five years since 2006. Unsurprising, considering the research also found that the median house price in Sydney had doubled from $470,000 to $1.05m during that period.
Meanwhile, in Melbourne, it’ll take the average first-home buyer 11 years and nine months to save for a house, which is four years and three months longer than it would’ve been in 2006. The median house price there jumped from $330,000 to $824,500 during that period.
Currently, Perth is the only capital city where saving for a house by residents is now faster (by one year) than it was back in 2006. Though Perth’s median house price moved from $370,000 to $538,000 in that time, the local market experienced price booms and busts leading to its price growth underperforming when compared with wages.
Earlier this year, Domain’s House Prices Report also found that, among the Australian capital cities, Perth was the most affordable city to buy.
“Unit prices in Perth buck the rising trend and fell moderately, a stronger performance in prior quarters have resulted in the steepest jump in 14 years,” said Dr Nicola Powell, Chief of Research and Economics at Domain. “This is good news for buyers seeking that affordability factor combined with future capital growth prospects.”
Dr Powell added that despite the big jump in house prices in Australia, in general, the rate of price growth was slowing down. “[Now] could be an opportunity for buyers to get into the market and make the most of ultra-low home loan rates and government stimulus,” she said.