Average First Home Buyer Needs $120K Deposit
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Average First Home Buyer Needs $120K Deposit

Finder’s latest figures show that only a few first home buyers plan to put down a 20% deposit.

By Kanebridge News
Tue, Jun 14, 2022 2:40pmGrey Clock 2 min

The average deposit needed to enter the property market has reached a record $120,000 according to analysis by comparison site Finder,

Finder’s senior editor of money Sarah Megginsons was shocked when the figure reached such lofty heights.

 “Many first-time buyers can’t afford the hefty deposits,” Ms Megginson said.

“Australia has recently been through a house price boom and the increased deposit requirement as a result is making it much harder to crack into the market,” she said.

“Getting on the property ladder is becoming out of reach for many with affordability deteriorating.”

According to the latest Australian Bureau of Statistics lending data, Finder put the average loan size for the first-home buyers at $479,610 in April — almost $33,000 higher than a year earlier and more than $40,000 higher than two years ago.

However, Ms Megginson has the latest figure at about $120,000 for a 20% deposit on the average $600,000 first-home buyer property.

While the deposit amount has reached a new peak, the price falls predicted by the likes of CBA and other major banks, should come as good news to those looking to get into the market.

Despite this, with the RBA adjusting for interest rates to fight soaring inflation, affordability remains an ongoing issue.

Higher rates will increase repayments and reduce borrowing capacities, which Ms Megginson noted means people won’t be able to borrow as much.

“The actual amount first-home buyers can borrow is going to fall, as well as the fact that repayments are going to increase,” she said.

The ABS data showed the number of new owner-occupier loans to first-home buyers fell by 4.4% in April, to be 34.3% lower than a year earlier. However, it remained 4.2% higher than pre-pandemic levels in February 2020.

The Finder survey found 75% of first-time buyers paid or are planning to pay less than a 20% deposit.

That included 14% who planned to or did pay just 5% upfront.

Only 16% of those surveyed had or planned to put down a 20% deposit, while another 9% expected to have more than 20%.


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4. Interiors Now!

Looking for a visual crash course in international design trends with longevity? This is the book for you. Featuring homes across the globe, from New York to Auckland via Avignon, the biggest dilemma for readers is settling on a style. Many of the projects are owned by designers and creatives, lending a dynamic edge to this tome, now in its 40th year. Taschen, $50

5. Home by the Sea 

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