To own a house is an incredible achievement especially with the demands faced by the new to the market, plus the added stresses of the coronavirus pandemic. Saving that first home deposit although usually cushioned by government incentive grants takes a certain amount of dedication and commitment to a strict savings plan and can take years. September 2020’s dip in housing prices in Australia’s largest capital cities was a small reprieve for home buyers, with affordability improving the time required to save that elusive deposit which is usually between 10-20% of the sale price plus government stamp duty and legal fees and in some cases lenders mortgage insurance. This is in addition to all the other costs involved with moving into a new home including council rates. The total time required was reduced by almost 6 months or 23 weeks in savings plans.
The analysis of affordability indexes that measure weekly earnings against average deposit size and against average home loan repayments have both slipped. But there is another factor adding to the extra stretch required to achieve the family home dream which is banks being more stringent with lending.