What’s standing in the way of home ownership dreams?

Amid an increasingly challenging environment for those looking to buy their first, or additional, property, Helia’s Home Buyer Sentiment Report 2024 revealed the top barriers preventing buyers over the last 12 months.

According to the report, 54 per cent of respondents identified that cost of living increases as the most cited barrier to home ownership, which overtook concerns about housing affordability (43 per cent) during 2023.

The third most cited barrier during this period was finding a suitable property within their budget in a suitable location (42 per cent).

The concerns surrounding cost of living were particularly apparent in those looking to purchase a property as an investment, with 61 per cent of first and additional property investors citing this as a challenge.

For owner-occupier first home buyers (FHBs), saving for a deposit also presented itself as a major hurdle, with 41 per cent of respondents saying so.

The report found that cost of living pressures have hindered the savings capacity of FHBs, with 24 per cent saving less than 10 per cent of their take-home pay, while 20 per cent save 20 per cent or less of their income.

This has led to home buyers taking longer to save for a deposit, with 25 per cent having needed to save for three to five years, while 17 per cent saved for over five years.

The report said: “To illustrate the challenge of saving for a home, consider a household with two median wage workers each earning $65,000.

“If they saved 20 per cent of their take-home pay, it would take almost 14 years to accumulate a 20 per cent deposit for a median-priced house in Sydney (valued at $1,471,892) and just over eight years for an apartment (valued at $859,050).”

For buyers in Melbourne and Brisbane, the time it would take to save for a deposit is around nine years for houses and six years for an apartment, with this time frame being significantly longer for single individuals assuming savings keep up with rising house prices.

Furthermore, expectations around the size of a deposit have changed as only 15 per cent of FHBs believed they were likely to save a full 20 per cent deposit, down from 20 per cent the year prior and 34 per cent in 2020.

According to Helia, this has suggested that most first-time home buyers have begun to shift away from the 20 per cent deposit goal, with 36 per cent now pursuing a 10–14 per cent deposit.

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Adrian Suljanovic is a journalist at Broker Daily with more than two years experience reporting on all facets of the third party distribution channel.

Adrian has written for a range of business and finance titles including IFA, Investor Daily and Lawyer’s Weekly before joining the mortgages team in 2022.

He graduated from the University of Wollongong in 2021 gaining a Bachelor of Communication & Media with a major in Digital & Social Media.

E-mail Adrian at: This email address is being protected from spambots. You need JavaScript enabled to view it.