New research from Domain shows that the amount of money required for a 20% housing deposit has roughly doubled over the past ten years across Australia’s capital cities:
A decade ago, the average deposit for a Sydney home was $158,000, but it has since increased to over $325,000.
In 2014, a Melbourne buyer would have needed a deposit of $119,000, but now they must find $206,000.
Brisbane buyers now need to save $185,000 for a 20% deposit, up from $94,000 a decade ago.
Perth buyers face a jump from approximately $123,000 to more than $155,000.
The rise in deposits follows a recent PropTrack report showing that Australia’s median housing affordability is the worst in at least 30 years:
The fall in affordability is widespread, affecting both higher and lower-income earners.
PropTrack also revealed that a median household in Australia can only afford 13% of homes sold:
PropTrack’s data is consistent with the following chart from AMP chief economist Shane Oliver, which shows a record disparity between median property prices and borrowing capacity:
This decreased borrowing capability reflects rising property values and skyrocketing mortgage interest rates.
Younger Australians have seen a considerable fall in homeownership rates in recent decades, as shown below:
With the current housing and immigration settings, I don’t see how things will change.
Australians may still yearn for home ownership. But for many, it will remain just a dream.
