New analysis by the ABC can reveal just how much harder it's become for young Australians to buy their first home. These days the average Australian household can expect to spend about ten and a half years saving for their deposit on a median-priced home. That's fifty per cent longer than it took thirty years ago.
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00:00We're speaking with three generations of the Cornish Templeton family, baby boomers
00:07Neil and Jenny, their Gen X daughter Megan, and Gen Z grandson Daniel and his wife Emma.
00:14They all bought their first homes in Melbourne's South East, and together they tell the story
00:19of Australia's changing property market since the 1970s.
00:22Ooh, that one's mine.
00:23It hasn't changed too much, and I can still see that they've got your curtains.
00:28Is that where you broke Caleb's leg?
00:31Yep.
00:32We were looking seriously, like going every Saturday, looking at like three or four homes,
00:39and it was the only house that we walked into and like, it ticks every box.
00:44It was a beautiful house.
00:46We had a $5,000 deposit saved after about 19 months of marriage, and this home was $25,000
00:53back in the day, 50 years ago.
00:55That was then, but what do they think it's worth now?
00:58What do you reckon?
00:59I reckon a million.
01:00I think a lot more than that.
01:01You were right, Neil!
01:02I should have kept it.
01:07It took Megan and her husband six years to save their deposit, but they weren't feeling
01:11the pressure.
01:12I think similar to you, I don't remember saving earnestly.
01:15I would say 1.13.
01:18Ooh, 1.22.
01:22When Daniel and Emma snagged a townhouse in Croydon this year, they joined a growing cohort
01:27receiving help from the Bank of Mum and Dad.
01:29I don't know many people at our age that are in the process or have just bought a home
01:35without the assistance of family.
01:42A data analysis by the ABC taking into account changing house prices, incomes and interest
01:47rates shows their experience is fairly typical.
01:50Back in 1990, it took about seven years to save a deposit, based on a household putting
01:55away 20% of its income.
01:57By the time Megan bought in 2003, it was up to eight and a half years.
02:01And by the year Emma and Daniel bought, it was up to ten and a half years.
02:06According to the ABC analysis, the amount of a household's income going on mortgage
02:10repayments has also jumped.
02:13Accountant Neil estimates a quarter of his and Jenny's take-home pay went on repayments.
02:18In 2003, the average household was spending 35% of its income on mortgage repayments.
02:23And by 2024, it was 45%.
02:26I feel sorry for you.
02:27I feel very sorry for you, Jenny.
02:29And I'm very jealous of where you were at.
02:32Oh, to be a baby boomer, hey?
02:34Big difference.
02:36For now, market analysts don't expect any significant increase in housing affordability
02:40for Australia's young people.
02:42I think the best that we can hope for is a slow, steady decline in home values that doesn't
02:47put the majority of mortgaged Australians at risk of negative equity.
02:52And this is what the bank takes.
02:53Whatever.