Unrealistic salary you need to be earning to afford a house in each Aussie city

Average house prices in Australia are now so high that Australians on a national average salary would not be able to get a loan to buy a house in most major cities.

Those with an average salary of $103,000 are locked out of owning a home in Sydney, Melbourne, Brisbane and Adelaide unless they somehow manage to come up with a huge deposit.

A report from Canstar analysis for the Sunday Telegraph found that the situation is affecting potential homebuyers in every age bracket, leaving many wondering if they will ever become owner-occupiers.

In Sydney, one person would need a pre-tax income of $234,960 to afford the loan on Sydney’s $1.47 million average house price.

Shockingly, even a Sydney couple, each earning the national average salary, would not be able to get a loan to buy a house in metropolitan Sydney at current prices.

Both partners would need pre-tax income of $113,340 or more, and a down payment of nearly $300,000, before they would be approved for a loan.

In Melbourne – the country’s second most populous city – a single person would need a salary of $141,580 to afford the average house price of $917,000.

It’s even tougher in Brisbane, where a single person needs a salary of $149,346 to get approved for a home loan at the median price, while in Adelaide they need $134,952.

“Rising property prices, combined with higher rates, rentals and daily living costs have put home buying firmly out of reach for many Australians hoping to purchase a home they can call their own,” Canstar managing director Sally Tindall said.

‘Someone on a middle income, with no partner to buy with, or no family member to give them a helping hand, will likely find it extremely difficult, and in some cases almost impossible, to buy a home . mid-priced apartments, let alone a house, in major real estate hotspots across the country.”

Ms Tindall said this could mean people will have to look for a smaller apartment to achieve the Australian dream of home ownership.

“A place further away from friends and family, a fixer-upper that doesn’t have a swarm of interested buyers – even if you’re buying an investment property as your first foot on the property ladder,” she said.

The situation has become so desperate that some young people who have money to spend – but not enough to get a mortgage – want to invest their money elsewhere.

Social demographer Mark McCrindle said many are now ‘removing the home purchase goal as a key measure of success in life and focusing on financial independence’.

Even a Sydney couple who each earned the national average salary wouldn’t get a loan to buy a house in metropolitan Sydney at today’s prices. Stock image

“This research shows that ambitious young Australians are being forced to climb the property ladder later in life amid skyrocketing house prices, interest rates and inflation, meaning they are forced to buy their first home in their late 30s and early 40s.” , Mr McCrindle said. the Sunday Telegraph.

He said a new Australian dream is emerging to be debt free, rather than having a huge mortgage.

Australians are studying later and spending money previously earmarked for buying a house on short-term investments such as cryptocurrency and non-fungible tokens, Mr McCrindle said.

“They are living at home longer, marrying later, studying at higher costs and even having children later than ever before,” he said.

‘They are forced to either depend on their father and mother’s bank or wait for an inheritance.’

Australia’s two largest cities offer some hope to those who want to pursue the dream of home ownership. They are showing signs of a real estate decline due to an unsustainable gap between borrowing capacity and home values, although prices are still rising in some other cities.

Australian property price growth is slowing, but not enough to solve serious housing affordability challenges.

Sydney and Melbourne are driving the decline, while Canberra and Hobart values ​​are also falling, while price growth in other capital cities and regions in Australia continues – albeit at a slower pace, analysis from property data firm CoreLogic shows.

“Even in the highest growth markets such as Perth, Brisbane and Adelaide, we are seeing the pace of growth slowing,” said Eliza Owen, head of research at CoreLogic.

Sydney and Melbourne have about 40 percent of the country’s housing stock, account for about half of the total value of homes nationwide and largely influence the change in value.

Seasonally adjusted for the generally slower December, national values ​​rose slightly, but more homes have come onto the market and are taking longer to sell.

Growth has been slowing since June, but values ​​have been steadily rising over the past 21 months, rising by almost 15 percent over the same period and are unlikely to fall anywhere near that amount, Ms. Owen to it.