First Home Buyer Options Shrink
The share of homes within a First Home Buyer’s budget has fallen dramatically to about 12% of the housing stock.
Analysis by KPMG says that in FY2020 a FHB with an average annual household income of $180,000 could afford to buy about 30% of the housing stock.
KPMG Urban Economist Terry Rawnsley says home loan data shows First Home Buyers now need household incomes of about $180,000 to service a typical home loan.
South Australia and Western Australia are the best states for first-home buyers, with about a quarter of housing stock within their budgets.
In Queensland, about 15% of markets are within reach, while in Victoria it is just 10%, and Sydney is half that at 5%.
Rawnsley says the sharp rise in house prices across Western Australia, Queensland and South Australia in the past five years has significantly reduced the share of the market accessible to first-home buyers.
He says the figures are a good example that not only does Australia need more housing supply but it needs to be at a price point accessible to first home buyers.
The data shows that in the past three years, the amount of new housing supply priced at $800,000 or lower has steadily fallen. In FY2023, about 30% of properties were within the price point and by FY2025, it was 12%.
