First home buyer affordability worsens

Australian couples need to raise $85,800 deposit for a median-priced house.

AAP

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HOUSING affordability has worsened during the past year, with first-home buyers needing to save 10 per cent more for a deposit, a report shows.

Australian couples need to raise $85,800 deposit for a median-priced house, compared with $78,100 a year earlier, the Bankwest analysis showed.

It was now taking 4.5 years to save for a 20 per cent house deposit, up from 3.7 years in the previous annual report.

The situation was worse in more expensive parts of Sydney, Melbourne and Perth, with buyers needing to spend a decade saving up for a deposit to enter the property market in 26 local government areas.

Saving for a median-priced unit was marginally less daunting, with first-home buyers needing to find $76,900 for a deposit - a four-year task.

Bankwest Retail chief executive Vittoria Shortt said a growing army of first home buyers were being locked out as established property owners benefited.

"This is the stark reality of a strong Australian property sector," she said.

Still, home borrowers are likely to have some relief on Tuesday.

The Reserve Bank of Australia is widely tipped to leave interest rates on hold at 4.5 per cent as it focuses on Europe's debt worries instead of domestic inflation.