Saving for a home? It might take you ten years

New CoreLogic figures have painted a more stable picture of the Australian housing market but saving for a house deposit can still take up to ten years to achieve.

The July CoreLogic Hedonic Home Value Index shows the median property prices across each capital city. Sydney still dominates the property market with a median property value of $775,978.

Melbourne follows close behind at $619,443. Both capitals saw growth of 0.2 per cent over the month.

CoreLogic head of research, Tim Lawless said:

“Our national dwelling value index may have found a floor in July, with dwelling values holding firm over the month following a consistent trend towards smaller month-on-month declines through the first half of the year. Since peaking, the national index is down 8.3%.”

Time taken to save for a deposit

Source: RateCity.com.au, CoreLogic Hedonic Home Value Index

Note: Total deposit figures factor 10% deposit, plus stamp duty and LMI for non-first home buyer. Time taken to save based on savings account paying 2% interest p.a. 

RateCity research has found that it still takes over ten years to save a deposit for a median priced property in Sydney when putting $200 each week into a savings account (paying 2 per cent interest).

It’s a similar story in Melbourne, with homebuyers waiting nine and a half years to afford a property deposit. 

Saving for a property deposit in Brisbane and Darwin is the most time-effective, whether you can afford $200 or $400 a week. This is thanks to Brisbane’s affordable stamp duty prices and Darwin’s low property prices.

How you can speed up your saving time

There are a few ways you can save a property deposit a little faster:

1. Move back in with mum and dad: If you’re looking for your first home, moving back to mum and dad’s can be a very cost-effective way to live. Put what you would have spent on rent into a high interest savings account and fast track your way into getting out of your parents’ house and into your new home.

1. Move interstate: If you’re lucky enough to have flexibility within your career and/or if your family are able to, moving interstate is an easy way to cut down on the deposit saving grind. Just by travelling from Sydney to Perth, for example, you’re shaving almost five years off of your wait time.

1. Compare high rate savings accounts: With savings account interest rates being slashed by most lenders following the two RBA-led cash rate cuts, finding a high rate paying savings account can feel like looking for a needle in a haystack. More than ever it is crucial you do your research around the most competitive savings accounts for your financial needs, so you can save for a deposit faster.

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