Aussies now require a deposit of $ 106,742 to enter

0

Australia’s housing market is worth FOUR TIMES the rest of the economy – but it’s bad news for young Aussies who now need a $ 107,000 down payment to get up the ladder

  • Real estate worth more than the GDP of any country except China and the US.
  • The down payment is up 16% to $ 106,742 in just a year
  • A third of first-time home buyers say they depend on ‘mom and dad’ for a down payment

The value of Australian homes has soared above $ 8 trillion – more than the gross domestic product of almost any country on Earth – as the amount of money you need for your home deposit increases 16 percent in just one year.

Real estate analyst CoreLogic said on Friday that the estimate of the total value of residential real estate in Australia has reached $ 8.1 trillion.

This equates to more than $ 310,000 per Australian resident and more than the GDP of any country except the United States and China.

It means that the value of Australian real estate has nearly doubled in ten years.

The housing market in Australia is booming, with the largest monthly profit in 17 years (above a Sydney auction)

The housing market in Australia is booming, with the largest monthly profit in 17 years (above a Sydney auction)

“This puts Australian residential real estate at about four times the size of Australian GDP and about $ 1 trillion more than the combined value of the ASX, superannuation and commercial real estate combined,” said CoreLogic lead researcher Eliza Owen in a statement.

CoreLogic’s national home value index rose 1.8 percent in April after hitting a 2.8 percent mark in the previous month, a 32-month high.

The index is up 10.2 percent since the pandemic low in September.

CoreLogic said many Australian housing markets – driven by record low interest rates and government subsidies – were at their peak, with national home values ​​rising 6.8 percent in the three months to April.

One-third of Aussies say 'Mom and Dad's bank' was the only solution to the average $ 107,000 deposit

One-third of Aussies say 'Mom and Dad's bank' was the only solution to the average $ 107,000 deposit

One-third of Aussies say ‘Mom and Dad’s bank’ was the only solution to the average $ 107,000 deposit

“ The appreciation of residential real estate has given Australian homeowners a strong equity position, with the (Reserve Bank of Australia) estimating that only 1.3 percent of home loans will have negative equity in early 2021, ” Ms. Owen said.

However, for many Australians looking to get a foothold on the real estate ladder, the continued strength of the market makes home ownership further out of reach, despite record low mortgage rates.

“Wage growth is just not keeping up.”

Comparison website Finder found last week that aspiring Australian homeowners need a six-figure deposit to get a foot in the door.

More than 10 percent would take more than a decade to scrape together the required amount, a survey of 1,028 startups found.

The most recent ABS data shows that the average down payment to secure a mortgage is $ 106,743 – 16 percent more than what was required two years ago.

For nearly a third of startups surveyed, the “ mom and dad’s bank ” was the solution, with parents lending an estimated $ 29 billion to their grown children to invest in bricks and mortar over the past 12 months.

Advertisement

.