It\u2019s officially the worst time to be a first-home buyer in at least 56 years.<\/p>\n
New figures have revealed first-home buyers face the most challenging buying conditions since price records began in 1970 due to soaring debt, high interest and minimal growth in wages.<\/p>\n
And recent falls in prices in many suburbs and generous government support have done little to help, the FoundIt research noted.<\/p>\n
The study flies in the face of recent claims by Labor frontbencher Tanya Plibersek that: \u201cIt\u2019s never been a better time to be a first-home buyer\u201d.<\/p>\n
It also throws in doubt Prime Minister Anthony Albanese\u2019s claim his budget would help first-home buyers.<\/p>\n
Back in May, he claimed his changes would \u201cmake our tax system fairer to help more Australians into homeownership \u2026 this is about giving younger Australians a leg-up in the housing market\u201d.<\/p>\n
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The current downturn has seldom helped first-home buyers as most of the falls are at the top-end, while prices for cheaper homes have grown in some suburbs. Picture: Tim Hunter.<\/p>\n
The study by analytics group FoundIt \u2013 authored by Kent Lardner, a pioneer in Australian valuations data \u2013 measured interest rates, the average gap between wages and prices and deposit requirements.<\/p>\n
It found that an average income earner purchasing a median-priced capital city home needed to spend 10.2 times their wages to get into the market, the highest since 1970.<\/p>\n
2026 was found to be the first year on record where saving a 10 per cent deposit required more than a year of the average wage.<\/p>\n
Recent price decreases were also deemed to have been little benefit for first-home buyers because interest rate hikes had reduced their borrowing power by more than the discounts they could get on homes.<\/p>\n
Meanwhile, wages had failed to keep up with the cost of living, meaning homeowners had to divert much larger proportions of their income into servicing their mortgage repayments than in previous years.<\/p>\n
MORE: Fury as $675k earner gets govt aid<\/a><\/p>\n MP Tanya Plibersek said on a Channel 7 appearance that there\u2019s \u201cnever been a better time to be first home buyer\u201d. Picture: Monique Harmer<\/p>\n Mr Lardner said it was a \u201chorrible\u201d time to be a first-home buyer because getting into the market required record levels of debt that was becoming more expensive to service.<\/p>\n It was also noted that current conditions presented more of a challenge than even the 1989 market, when interest rates were 17 per cent.<\/p>\n Part of the reason was because the debt required to buy in the current market far exceeded levels in 1989 \u2013 prices then were four times the typical income, today they\u2019re 10 times higher.<\/p>\n First-home buyers have been slammed with an additional level of risk: prices in the bottom end of the market have yet to fall by anything close to the margins in the top-end of the market.<\/p>\n Some popular first-home buyer markets have actually recorded price rises, even as the rest of the market has fallen.<\/p>\n<\/p>\n