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The latest First Home Buyer Report released by Domain has found that prospective buyers saving for a 20 per cent deposit on a unit will save them almost two years when compared to buying a house, presenting first home buyers with one of the fastest ways to enter the property market.
According to Domain, the time needed to save for an entry-priced unit (around $481,000 nationally) has dropped by two months across the combined capitals, down to three years and five months (annual change).
Meanwhile, the time needed to save for an entry-priced house – around $617,500 nationally – increased by one month to five years and one month.
It should be noted that the report utilised a hypothetical scenario of first home buyer couples aged 25–34 on a city-by-city basis, ranging from an income of $65,980 in Canberra and $53,891 in Hobart.
Furthermore, the time to save varies widely across the capitals, for example, a house in Sydney valued at $990,000 offers the longest path to home ownership, while a unit in Darwin ($285,000) offers the quickest path.
Domain’s chief of research and economics, Dr Nicola Powell, said: “The latest report highlights the big challenges first home buyers face in Australia.
“In the past five years, entry house prices have increased 58 per cent, while unit prices have risen by 27 per cent. Meanwhile inflation surged 20 per cent, and wages only grew by 15 per cent. This shows the growing gap between earnings and property costs, making it harder for first-home buyers to get into the market.”
Despite the seemingly grim scenario for first home buyers, Powell said that there’s “some good news in certain areas”.
“In Sydney, while it’s still the toughest city overall, it’s now 15 months faster to save for an entry-level unit compared to five years ago. This is thanks to higher wages, better interest rates on savings, and more stable unit prices,” Powell said.
“On the flip side, Brisbane, Adelaide, and Perth have seen longer saving times for both units and houses because prices have risen faster than wages and saving rates.
“Darwin is still the top city for first-home buyers. It has the quickest path to homeownership, with just 3 years and 5 months needed for an entry-level house and 2 years and 1 month for a unit – half the time it takes in Sydney.”
The report also found that all capital cities excluding Darwin contained borrowers under mortgage stress, where mortgage stress is defined as occurring when repayments exceed more than 30 per cent of household income.
The only two cities that had mortgage stress for entry-priced houses were Sydney and Melbourne in 2019, while no cities experienced mortgage stress for units that same year.
However, mortgage stress for units can be seen in Sydney, Brisbane, and Adelaide as of 2025.
On a national basis, mortgage repayments as a percentage of income for entry-priced houses in the capitals have risen 47.1 per cent of household income today, up from 46 per cent a year ago and 28.2 per cent five years ago, while units require 30.7 per cent of household income.
Powell said: “These differences highlight the huge gap in affordability across cities, making it clear that coordinated government action is needed to tackle Australia’s housing shortage.
“The National Housing Accord, which aims to build 1.2 million homes in the next 5 years, is a step in the right direction. But it’s crucial for all levels of government to work with the industry to ensure we have enough affordable housing in the future.”
[RELATED: Mortgage stress ‘more widespread’ than 5 years ago]
