The Reserve Bank of Australia has found that an average home would have cost you about 2.5 times the average household income back in 1990.
Jump to 2021, and the disparity has increased by 100%. Housing across Australia costs five times the average household disposable income in 2021.
The cost of buying a home in capital cities is even higher. Sydney, one of the capital cities, ranks third on the list of cities with the least affordable housing.
Despite an improving job market following 2020’s lockdowns and COVID-19 related closures, house price growth is significantly outstripping wage growth. Experts think that by the start of 2022, house prices could rise ten times faster than wages.
Whatever might be in store for 2022 there are strong indicators that 2021 could be a good year to get into the property market.
Property prices are expected to rise by 15 to 20% over the year, and saving a deposit to cover the increase could be a big challenge.
With the stong growth in house prices, getting in the property market may mean looking at surburbs a bit further out from the city centre or in some cases increasing your budget however it could be well worth it.
Another option to enter the property market in 2021 is by purchasing apartments. Apartments, compared to single dwellings, are much more affordable.
Even with a red hot property market, the median price for apartments has only increased by 1.62%, aggregated in five capital cities – Sydney, Melbourne, Brisbane, Adelaide and Perth.
If you are looking to purchase and want some help exploring your options 9r understanding your maximum borrowng capacity get in touch with your local Cornerstone Home Loans Broker.