{"id":39433,"date":"2022-07-07T14:03:48","date_gmt":"2022-07-07T02:03:48","guid":{"rendered":"https:\/\/propertynoise.co.nz\/au\/?p=39433"},"modified":"2022-07-07T14:03:48","modified_gmt":"2022-07-07T02:03:48","slug":"major-stumbling-block-most-first-homebuyers-face","status":"publish","type":"post","link":"https:\/\/propertynoise.co.nz\/au\/major-stumbling-block-most-first-homebuyers-face\/","title":{"rendered":"Major stumbling block most first homebuyers face"},"content":{"rendered":"

PHOTO: First home buyers are facing huge deposit burdens as interest rates climb.<\/strong><\/p>\n

A first homebuyer<\/a> working two jobs, seven days a week has revealed why she still can\u2019t buy a house \u2013 and it\u2019s part of a problem that many are facing.<\/p>\n

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A frustrated home seeker has revealed how working seven days a week in two jobs, while living with her partner\u2019s parents, still hasn\u2019t been enough to help her save a deposit fast enough to buy a property in Sydney.<\/p>\n

\"Effie<\/a><\/div>\n
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She\u2019s among a rising number of younger buyers reporting the deposit hurdle for a property is proving too high to climb, with PropTrack data showing new buyers have to spend twice as much of their income on deposits as those in the 1980s and 1990s.<\/p>\n

First homebuyer Ashley Van Deyk, 25, and her partner have spent the past four years scrimping every dollar they could to save a 5-10 per cent deposit while living with her partner\u2019s parents.<\/p>\n

\"First<\/a><\/div>\n
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She has had to work two jobs, seven days a week while saying no to date nights and social events.<\/p>\n

But despite working hard and living frugally, the pair have needed to adjust their expectations around whether they can afford a freestanding home near family in the Northern Beaches.<\/p>\n

It\u2019s a story told time and time again by Millennials, who face a deposit hurdle far bigger than their predecessors.<\/p>\n

\"Brendan<\/a><\/div>\n
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PropTrack data shows new purchasers currently face the least affordable upfront costs since 1984, the earliest year with available records.<\/p>\n

Scraping together a 20 per cent deposit on a NSW home at the current median price requires 160 per cent of the average annual income, close to double what it was in the 1980s and 1990s.<\/p>\n

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The Northern Beaches has been in high demand during Covid.<\/strong><\/em><\/div>\n

While government grants and exemptions have reduced the deposit burden for some first home buyers, purchasers like Ms Van Deyk haven\u2019t been able to use them because of the price caps in place.<\/p>\n

\u201cWhen we have kids, we want to be close to family,\u201d she said.<\/p>\n

\"First<\/a><\/div>\n
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\u201cHouses here are not in that cap.\u201d<\/p>\n

\u201cLast year, there was nothing on the Beaches below $2m.\u201d<\/p>\n

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\"130<\/div>\n

130 Prince Alfred Pde, Newport sold for almost $3m at the start of the pandemic.<\/strong><\/em><\/div>\n

Having a strict budget with little wriggle room has also made it hard to compete with other buyers.<\/p>\n

Last year, they found themselves constantly missing out on property because the market was so hot.<\/p>\n

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\u201cYou just always seem to be just shy of the one that you want because someone else does have a little bit more money and that makes all the difference,\u201d she said.<\/p>\n

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The younger generation are being priced out of the Northern Beaches. Picture: John Appleyard<\/strong><\/em><\/div>\n

She said the rising cost of living and slow wage growth made it difficult to navigate the fast moving property market, in contrast to what her in-laws experienced in 1994 when they bought the family home.<\/p>\n

\u201cThey would have been younger than I am now when they bought their beautiful home in Manly Vale,\u201d Ms Van Deyk said.<\/p>\n

\u201cThe cost of living is higher and the wages aren\u2019t high enough to compensate for that.\u201d<\/p>\n

\u201cI think it\u2019s 10 times harder now.\u201d<\/p>\n

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This Narraweena house was one of four properties listed for sale in the suburb when it sold last year.<\/strong><\/em><\/div>\n

Her partner\u2019s parents purchased their house directly from the owner after seeing it advertised in the local paper. They said this was common practice in the 1990s.<\/p>\n

\u201cIt was a direct sale. The owner said, \u2018I want this\u2019, they offered it to them and it was that simple,\u201d Ms Van Deyk said.<\/p>\n

While her in-laws paid as much as 23 per cent interest at one stage, the banks didn\u2019t impose purchasing caps like they do now \u2013 another factor that has restricted Ms Van Deyk\u2019s search.<\/p>\n

She and her partner went from being able to borrow seven times their income to being able to borrow six times their income when APRA introduced measures to curb lending growth last year.<\/p>\n

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\"Ashley<\/div>\n

Ashley Van Deyk says saving a large enough deposit is a challenge. Picture: Tim Hunter.<\/strong><\/em><\/div>\n

\u201cThis massively reduced what we were able to borrow,\u201d she said.<\/p>\n

She said the Northern beaches was slipping out of reach for younger first home buyers.<\/p>\n

\u201cIf you worked really hard, by the time you were 21 you could own a home (in the 90s),\u201d she said.<\/p>\n

\u201cUnfortunately now, I don\u2019t think by the time you are 21 or 22 you can own a stand-alone home in the Northern beaches without help.\u201d<\/p>\n

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\"The<\/div>\n

The Northern Beaches is a beautiful but expensive area in Sydney.<\/strong><\/em><\/div>\n

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