First home deposits take less time to save

Reported by AAP
Friday, December 7, 2012

Currency Converter

Mark BourisMyths bustedHome loans can seem a bit complicated and overwhelming. But it doesn't have to be. Mark Bouris clears up some common misconceptions.

Home buyers are taking less time to save a deposit for their first property as prices stagnate and incomes rise.

Couples buying their first place took about three years and nine months on average to save a deposit in 2012 - about three months less than in 2011.

And they didn't have to save quite as hard, with the average amount needed for a deposit falling by $3,000.

The findings were part of a study released on Friday by Bankwest, which attributed the drop in saving time to plateauing house prices and increasing wages.

"It's the two factors combined - not one or the other" Bankwest retail chief executive Vittoria Shortt told AAP.

Owning that precious first home won't be quite so easy if you live in Sydney or Melbourne, where it will take five years and eight months and five years respectively to save for a deposit.

"It's no surprise that Sydney takes the longest," she said.

"That's really driven by property prices."

But if you happen to live in Queensland or Tasmania, it will only take three years and seven months to lay down a deposit on a home in both states' capitals, Brisbane and Hobart.

The study found first home buyers needed to save an $77,600 in the 2011/2012 financial year for a 20 per cent deposit on the median national house price of $423,000.

That was almost $3,000 less than the $80,500 needed the year before.

Almost 15,000 more buyers secured their first home in the 2011/2012 financial year than the previous year, a rise of 17 per cent.

"People are starting to think that it's a good time to buy and feeling more comfortable about buying," Ms Shortt said.

Those who live in the more expensive cities should look at buying in outer suburbs, she added.

"Every state has places where you can find cheaper property and that's the most important factor for anyone thinking of buying a first home," she said.

The Bankwest study used Australian Bureau of Statistics Census income data for couples aged 25 to 34 and median house prices to determine average times to save a 20 per cent deposit.

17/04/2014 16:58Sydney, Australia. 17 April,2014
advertisement