A new study by BankWest reveals the wages of first-time home buyers are being outpaced by increasing house prices across Australia.
Record-low interest rates
are not doing property beginners much good either. Their pay packages have increased by 2.6% in 2014, as median house values are up by 7.1%.
This trend forces would-be first-time home buyers to spend more time either renting or living with their parents to save up for a sufficient mortgage deposit, BankWest said.
Ian Rakhit, BankWest head of specialist banking, said record low rates for home loans made it even more difficult for first home
buyers to penetrate the housing market as savings accounts offered small returns.
"Certainly, today's low interest rates make home loans more serviceable for young home owners," he said.
"But for most, saving a deposit for their first home remains the biggest challenge."
The non-major bank’s annual first time buyer deposit report found the median Australian home prices to be $469,000 this year, up from $438,000 in 2013.
This price hike makes saving the 20% deposit harder for most buyers, as it now takes 4.1 years to save from the previous average of 3.9 years.
The report also noted that Sydney, Australia's most expensive housing market, saw its median house prices climb up to $825,500. This requires a $165,100 deposit.
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