These buyers are significantly expanding their budgets due to the rapid rise in affordable home prices, which have grown faster than higher-end properties. As a result, many are looking beyond conventional saving methods and instead relying on family assistance, shared purchases with friends or siblings and a range of government incentives to enter the market.
Research by Resolve Finance shows that this trend goes beyond Sydney. First-home budgets have increased substantially in Perth, Brisbane and Adelaide, while cities like Melbourne have seen smaller rises. Across Australia, the average first-home budget now sits at around $637,000. With wages remaining relatively flat and affordable property stock under pressure, many buyers are entering the market later in life, often in their mid-to-late 30s, and choosing larger homes to accommodate growing families.
Sydney buyers face some of the toughest borrowing conditions. Dual-income couples now need a borrowing capacity of approximately $804,000, making it challenging for single buyers unless they are earning well above the average wage. In Perth, average borrowing for first-time buyers has jumped from $435,000 to $614,000 in just 12 months, with similar increases seen in other capital cities. Regional areas are also feeling the impact, with parts of Queensland recording an increase in average first-home budgets from $497,000 to $580,000.
These changes indicate a broader shift in attitudes towards home ownership. More buyers are turning to rentvesting, purchasing property in affordable areas while continuing to rent in locations they prefer. Some are choosing to buy properties jointly with friends or family. Government initiatives are also playing a critical role, with 36% of first-home buyers now depending on support such as the First Home Guarantee. This scheme recently removed income caps and lifted price limits across major cities. In Sydney, the limit now sits at $1.5 million, giving buyers more options though raising concerns about a short-term rise in property prices.
While these creative strategies are helping more Australians enter a competitive housing market, the widening gap between property prices and incomes remains a major obstacle. Whether these approaches will resolve long-term affordability issues is still uncertain but for now, buyers appear committed to finding a way in.
