Is housing unaffordable for first time buyers?

November 11, 2015
Whitney Evans

Media Release

11 November 2015

 Is housing unaffordable for first time buyers?

New data from Mortgage Choice highlights attitudes of FHBs

More than 80% of first home buyers who are planning to purchase property within the next two years believe housing is unaffordable in their state.

According to Mortgage Choice’s annual First Home Buyer Survey, 80.6% of those purchasing property for the first time consider housing to be ‘unaffordable’.

Local Mortgage Choice franchise owner Antony Muir said the issue of unaffordable housing was more predominant in certain states.

“The percentage of first home buyers who consider housing to be unaffordable is significantly higher in New South Wales and Victoria than it is in Queensland and South Australia,” he said.

Across the country, first home buyers in New South Wales were the most disillusioned about property prices, with 86.9% of respondents stating housing was unaffordable in their state. Victoria was next with 85.7% of first time buyers saying property was too pricey. Meanwhile, in South Australia and Queensland 76.8% and 75.4% of first home buyers respectively said housing was unaffordable in their states.

Mr Muir said it was unsurprising to see the majority of first home buyers believe housing is unaffordable, as data from the Australian Bureau of Statistics shows the average home loan has grown almost four times faster than the average Australian full-time wage in the last two years.

According to the data, the average home loan grew by 18.5% in the two years to April 2015 – from $301,800 to $357,500. Meanwhile, the average Australian full time wage grew just 3.6% from $77,225 to $80,054.

As a result, the average home loan size in Australia is now approximately 4.5 times larger than the average wage – up 25% in the last two years. In 2013, the average loan size was 3.9 times the average full-time Australian wage.

“These statistics are worrying as they clearly show wages aren’t keep up with property prices,” Mr Muir said.

“At Mortgage Choice, we believe it is time for the government to act and introduce measures that would make it easier for first time buyers to purchase property.

“Our data shows the majority of potential first home buyers would like to see the government re-introduce a grant for established properties.

“While the various states currently have first home buyer grants in place for those who purchase a newly built property, nothing is given to those buying established properties, which is approximately 80% of all first time buyers.”

According to the survey, 42.5% of respondents said they would like to see the government introduce a first home owner grant for established properties, while a further 30.6% would like to see the government remove stamp duty for first time buyers.

Mr Muir said now was the perfect time for the government to introduce a new incentive for first time buyers.

“With property prices rising steadily across most markets, a lot of first time buyers are finding themselves priced out of the market. To rectify this problem, the government really needs to act,” he said.

“Now we have a new Prime Minister in place, I would like to see the plight of first time buyers receive the attention it deserves.”

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Table 1: Housing affordability

Do you believe housing is unaffordable in your state?






















Table 2: First home buyer incentives

If the government was to introduce a first home buyer incentive, which program would help you the most?







Allowing you to use your super to buy your first home







A first home owner grant for established properties







The removal of stamp duty















As your local home loan experts we are here to assist with all of your financial needs and goals. With the help of Antony Muir and his expert team we will provide you with professional financial and home loan guidance. Call Mortgage Choice Bundall today on 07 5504 5569 for an appointment and let us help you achieve your financial goals.

Late night appointments available Monday - Thursday.



About the Survey

Market research company Nine Rewards was commissioned by Mortgage Choice to conduct the 2015 First Home Buyer Survey. The online Survey was conducted in October and completed by more than 1,000 Australians who purchased their first home within the last two years or are looking to purchase in the next two years.

Important information

This article is for general information purposes only. It has been prepared without considering your objectives, financial situation or needs. You should, before acting on the advice, consider its appropriateness to your circumstances.


About Mortgage Choice

Mortgage Choice is an ASX listed company that seeks to help Australians with all of their financial needs.

Established in 1992, Mortgage Choice was originally established to help Australians improve their financial situation by offering a choice of home loan providers, coupled with the expert advice of a mortgage professional.

Since that time, the company has grown and developed into a fully fledged financial services provider.

Today, Mortgage Choice helps customers source car loans, personal loans, credit cards, commercial loans, asset finance, deposit bonds, and risk and general insurance.

Further, the company offers Australians access to real, relevant and affordable financial advice through our qualified financial advisers.

Mortgage Choice has no balance sheet or funding risk, and consistently delivers strong profits and attractive yields. It listed on the ASX in 2004 (MOC) and is a member of the Mortgage & Finance Association of Australia (MFAA).

Mortgage Choice holds an Australian Credit Licence: no. 382869 and Mortgage Choice Financial Planning Pty Limited holds an Australian Financial Services Licence: no. 422854. Both licences are issued by ASIC.

Recent recognition: 2015, 2014 Australian Broking Awards Best Diversification Program; 2013, 2012, 2011 Australian Broking Awards Major Brokerage of the Year – Franchise; 2013, 2012 Australian Broking Awards Best Ethical/Social Responsibility Program; 2012 Australian Broking Awards Best Training and Education;   No.1 on The Adviser magazine’s 2012, 2011, 2010 and 2009 Top 25 Brokerages list; 2012, 2010, 2009, 2008, 2006 and 2005 MFAA Awards Retail Aggregator/Originator of the Year; 2011, 2010, 2009 and 2008 10 Thousand FEET Top 10 Franchise list; 2010 Forbes Asia-Pacific Best Under A Billion list.

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