Ever wondered if you’ll ever own more than a collection of indoor plants? Well, new research has crunched the numbers and it looks like home ownership is getting way harder than it’s ever been, with some ’yuge salaries helping folks snap up houses in Australia.
Looking at the second half of 2024, Commonwealth Bank found around a quarter (20 per cent) of new home loan applications came from households earning between $150,000 and $200,000.
Meanwhile, some 30 per cent came from households earning between $200,000 and $500,000 for the same period. Yep, you read that right, that’s half a million.
Rounding off the six-figure-salaries, some 10 per cent of applications came from households between $100,000 and $125,000.
It’s a pretty big shift from just five years ago, with the numbers showing more higher-income households are turning to home loans while the rest of us appear to be sitting out the market, probably because of ongoing cost-of-living struggles.
What’s even crazier is that the average new loan from the Commonwealth Bank has shot up 38 per cent since 2020. Back then, the average loan was around $354,000. Now? A jaw-dropping $487,000.
As reported by the Sydney Morning Herald, rising property prices and the difficulties in saving up for a house deposit are making it pretty damn challenging for new buyers to dip their toes in this market.
Domain chief of research and economics Dr Nicola Powell told the publication those with higher incomes are looking to be the most active right now.
“They’re likely to already be in the property market, so they may be looking to make their upgrade,” she said.
Brett Sutton, a mortgage broker at Two Red Shoes, told the SMH he’d seen a noticeable decline in mortgage applications from lower-income households. On the flip side, high-income earners are becoming more prominent and they’re able to borrow more and afford homes in some of the more pricier areas.
“Their substantial incomes enhance borrowing capacity, allowing them to afford properties in desirable, often higher-priced, urban areas. This trend is particularly evident in city centres and affluent suburbs, where property prices have seen significant appreciation,” he said.
And the kicker is, average incomes are no longer enough to buy an average house in Australia’s major cities.
It’s pretty clear the elusive homeownership dream is getting even more challenging for those of us who aren’t pulling in six-figure salaries — is it just me or is it feeling more and more like a race we just can’t keep up with?
The post New Data Reveals How Much You Need To Earn To Buy A Home & I’m Shook appeared first on PEDESTRIAN.TV .
