The size of the average home deposit in Australia has soared to an all-time high.
For first home buyers looking to get onto the property ladder, the average home deposit is $119,560, according to new research by Finder.
It’s almost $30,000 more than the average full-time salary of $90,000.
A surge in property prices in 2021 led to the rise, with the average first home buyer deposit having risen by $11,700 over the year to March 2022 – equivalent to an 11 per cent increase, according to ABS figures.
It takes the average buyer two to five years to save for a deposit, according to Finder.
More than a third (36 per cent) of first home buyers took five years or more to save for a deposit.
Nearly one in 10 first home buyers (9 per cent) required 10 years or more to save enough money for a deposit, which is a slight decline from 11 per cent last year.
A further 25 per cent need between five and 10 years to save, while just 6 per cent are able to save in less than 12 months.
Graham Cooke, head of consumer research at Finder, said many first-time buyers can’t afford to pay up such a substantial amount.
“The recent house price boom combined with the increased deposit requirement is making it tough for first home buyers to infiltrate the market.
“Saving up to buy your first home has become a decade-long exercise for some people.
“Getting on the property ladder is becoming out of reach for many with affordability deteriorating.”
Three-quarters (75 per cent) of first home buyers paid or are planning to pay a deposit of less than 20 per cent.
He urged wannabe home buyers to supercharge their savings.
“Look for ways to stretch your dollar even further.
“Ongoing savings rates have improved to as high as 2.00 per cent pa and term deposits are as high as 3.75 per cent if you are willing to lock up your money for 24 months.
“Other non-savings products like Finder Earn allow savers to earn up to 6.01 per cent pa on their capital paid daily with no lock-ups.
“Also remember that, depending on your state, you will want to calculate your stamp duty too. This usually has to be paid for outside of your home loan,” Cooke said.
How much deposit did you/will you (and your co-buyers) put down on your property?
- Less than 5 per cent deposit: 4 per cent of buyers
- 5 per cent deposit: 14 per cent of buyers
- 6–10 per cent deposit: 31 per cent of buyers
- 11–15 per cent deposit: 18 per cent of buyers
- 16–19 per cent deposit: 8 per cent of buyers
- 20 per cent deposit: 16 per cent of buyers
- More than 20 per cent deposit: 9 per cent of buyers
Source: Finder First Home Buyer Report 2022