Sydney: A City in Crisis or One of Opportunity?
There’s no denying that the cost of living is putting a pinch on everyone’s pockets in 2023, but what’s the outlook for first home buyers looking to get into the property market right now? Though Sydney is certainly proving a difficult market to buy into for first and return homebuyers, that doesn’t mean Australia’s most populated city is impossible to acquire property or land in for your future residence.
Rising interest rates may be increasing mortgage costs, which makes it difficult for first-time buyers to get into the market in the first place, but as long as the government are offering fabulous schemes such as the First Home Owner Grant and Regional First Home Buyer Guarantee, there’s still hope.
While a recent study conducted by the Australian Housing and Urban Research Institute revealed that 40% of 25-34 year olds in Sydney and Perth were turning to mum and dad for financial support in nabbing their first property, rest assured that though gives many young buyers a better chance at buying their first home, it isn’t the only way to get your first foot on the property ladder.
Where is your salary going?
It seems Western Sydney residents are saving money rather swiftly, taking the shortest amount of time to build up the required 20% deposit. And while on average this takes approximately five years and six months to save up the deposit for a first home in the Mount Druitt area, or if purchasing an entry-level unit in Penrith, approximately two years and ten months, it is time spent wisely on the investment of a property that is yours.
The Domain First Home Buyer Report shows realistic data that a young couple with an average income would need to commit 50.9% of their salary towards initial mortgage repayments if buying an entry-level house in Sydney; a rise of 19.4% since 2021.
Unit buyers on the other hand would need to commit 34.2% of their income towards repayments on a $571,500 entry-level apartment – an increase of 8.7% from 2021.
Though this data might seem shocking, if you’re a tenant in Sydney, it’s likely you’re weekly wage is already being spent on rent as it is! So if that’s the case and you have some savings built up, you should consider putting the same weekly amount towards a mortgage of your own rather than paying big figures towards your landlord’s one.
Is now the time to buy?
With prices having softened by up to 20% in some Sydney areas since their peak in February 2022, it’s safe to say Sydney property is “cheap” at the moment. Buyers should keep their eyes peeled for a bargain (or at least a more affordable property catch) in or around Sydney in the months ahead!
If you’re looking to buy your first home, but are overwhelmed by all those hurdles ahead of you, we are the Australian buyers agency for you! Our expert property buyers at Kitty & Miles will guide you to make the right decision for your finances on your home buying journey, leaving you confident in your purchase and excited for the journey ahead. Give us a call on (02) 8916 61