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The housing downturn hasn't been all doom and gloom, with prospective first-home buyers finding that the long path to purchase has become that little bit shorter.
The figures, released in Domain’s First-Home Buyer Report, has identified the cities and areas that offer the lowest entry-price and quickest path to purchase across the capital cities.
The data assumes that the potential buyers are aged 25-34, in a couple, working full-time and earning an average wage, have no children and are both able to save 20 per cent of their post-tax income.
It has found that amid rising living costs and low wages growth first home buyers can now focus on building a savings plan to gain entry into previously inaccessible markets.
Related: Sydney Vacancy Rate at All Time High
Sydney remains the country’s toughest market to break into although first home buyers are slightly closer to their dream homes with five months being shaved off the time needed to save.
The time taken to save a deposit recording the biggest decline for both houses and units with first home buyers needing to save for six years and two months to attain a 20 per cent deposit on an entry-level house or five years and four months for an entry-level unit.
“Even though we’re seeing affordability increase, the journey to home ownership is still toughest in Sydney,” Domain senior research analyst Nicola Powell said.
“In the short term we are expecting prices to continue to fall, so I think affordability will continue to improve.”
Stamp duty exemptions and concessions dropped more than 20 per cent in the past year, recent figures from Revenue NSW show, while the number of first-home owner grants issued was also down 3.8 per cent from the previous summer.
Affordability remains a hot topic, with the average first-home buyer couple still needing to save for 20 years to pull together a deposit for an entry-level house in the eastern suburbs.
Related: Melbourne Knocks Off Sydney as Top Australian City for Investment
Houses: The path to purchase
Melbourne remains the second most expensive city to purchase an entry-level home behind Sydney.
First-home buyers will be saving for five years and nine months to achieve an entry-level house deposit and four years for an entry-level unit, shaving two months off compared to this time last year.
The report showed the price downturn was now hitting house and unit prices in outer-ring suburbs, though not as severely as inner suburbs.
“It’s a timely reminder that anyone looking to get on the property ladder needs to save (for some time) and ensure they are able to access enough money to get into the price points they want,” Powell said.
“For an upsizer, it also highlights what it takes to get into these inner areas.”
Melbourne has one of the largest differences between the property types of all the capitals, with an entry-price differential of $173,000. It takes an additional 21 months to save for an entry-level house instead of a unit.
The percentage difference between entry house and unit prices is at an all-time high, with high levels of development completions serving to contain unit prices relative to houses.
Related: These Are Brisbane's Most Affordable Suburbs: Domain
Units: The path to purchase
Brisbane remains one of Australia’s most affordable capital cities to break into with the average first-home buyer taking just over four years to save for a house.
The time to save for an entry-level house deposit has increased by one month over the year, to four years and three months.
Meanwhile, the time to save for an entry-level unit deposit continues to fall, down three months to three years and two months.
Brisbane’s relative affordability has continued to make it an attractive place for first-home buyers and interstate migrants.
“Although a substantial deposit is needed for a house in the inner-city suburbs, affordability there has improved in the past year, so the journey to save that 20 per cent deposit is now quicker,” Powell said.
Increased unit supply has created a window for buyers to purchase.
However, slowing building approvals, starts and completions will eventually see the heightened development supply absorbed.
