Why aspiring home owners need to aim high

Buying your first home can seem so far out of reach that it feels like you’ll be stuck in the rental trap forever, or worse, have to live with your parents well into your 30’s just to save a deposit. But there are faster ways to becoming a home owner.

To break into the market sooner it can pay to aim high, and look to apartments, to turn your home ownership aspirations into reality.

Take the fastest track to home ownership

According to the Bankwest First-Time Buyer Report, one of the fastest routes to becoming a home owner can be through apartments.

The time it takes for an average first-time buyer couple to save a 20% deposit for a capital-city apartment is 3.6 years. This is 1.3 years faster than saving a deposit for a house, which takes an ordinary couple 4.9 years on average.

To put this into a different perspective, you’ll need an average deposit of $89,035 for an apartment or $123,921 for an average deposit for a house. That’s a difference of more than $34,000.

How does your city stack up?

Some cities require even less time than the average 3.6 years needed to save a 20% deposit for an apartment.
 
Brisbane, Perth, Adelaide and Hobart are all much more accessible for first-time buyers seeking apartments.
 
On the other hand, if you live in either Sydney or Melbourne you’re likely to have to wait a bit longer for home ownership, even in an apartment.
 
In the Victorian capital it takes 4.4 years while Sydneysiders have to save for 5.9 years to reach a 20% deposit needed for an apartment.
 
But apartments in these markets also offer the greatest reduction in savings time compared to houses. In Sydney, it will take you an extra 2.3 years to save a deposit for a house, while in Melbourne you’ll have to wait an extra 2.2 years, making apartments a more accessible option for first-time buyers in these markets.

Average time it takes a first home buyer couple to save for a deposit

Capital city  Years to save for a house deposit (June 2017) Years to save for an apartment deposit (June 2017) Years less to save for an apartment deposit 
Adelaide 4.2 3.1  1.1 
Brisbane  4.5 3.3  1.2 
Canberra  4.6 3.1  1.5 
Darwin  3.8 2.7  1.1 
Hobart  3.8 2.9  0.9 
Melbourne  6.4 4.4 
Perth  3.9 3.2  0.7 
Sydney  8.2 5.9  2.3 
Average  4.9 3.6  1.3 
More

Sydney and Melbourne’s most affordable apartment locations

The good news is, there are areas within Sydney and Melbourne where you won’t have to wait as long for an apartment.

In Sydney, the Inner West, Parramatta and Campbelltown are among the areas where it takes the least amount of time to save a deposit for an apartment.

Similarly in Melbourne, Port Phillip, Maribyrnong and Moonee Valley offer first-time buyers the fastest route to buying an apartment.

Map of the surrounding suburbs around Sydney. Parramatta 5.1 years, Campbelltown 4.4 years, Inner West 5 years

The Inner West, Parramatta and Campbelltown are the most affordable locations in Sydney for apartments.

Map of the surrounding suburbs around Melbourne. Maribyrnong 3.6 years, Moonee Valley 3.7 years, Port Phillip 3.8 years

Port Phillip, Maribyrnong and Moonee Valley are the most affordable locations in Melbourne for apartments.

Cafés and cronuts, or up-keep and cleaning?

As well as allowing first-time buyers to break into the market sooner, apartments can be a better option for those wanting a more carefree and urban lifestyle.

By choosing an apartment for your first home, you’re likely to be closer to cafés and retail precincts where you can catch up with friends and family.

You can also be closer to public transport links, meaning you’ll spend less time in traffic jams. Don’t bother buying a lawn mower either. You won’t have to spend your weekends maintaining a big garden and you’ll have more spare time to do the things you love.

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Things you should know

The information contained in this article is of a general nature and is not intended to be nor should it be considered as professional advice. You should not act on the basis of anything contained in this article without first obtaining specific professional advice. Also to the extent permitted by law, Bankwest, a division of Commonwealth Bank of Australia ABN 48 123 123 124 AFSL/Australian credit licence 234945, its related bodies corporate, employees and contractors accept no liability or responsibility to any persons for any loss which may be incurred or suffered as a result of acting on or refraining from acting as a result of anything contained in this article.