Astronomical house price growth has seen first home buyers in New South Wales and Victoria seriously struggling to find enough affordable suburbs in their home state, forcing them to look elsewhere and pushing up demand in other states, new data has revealed.
Analysis of more than 3,000 transactions from digital loan platform Hashching found that Aussies in certain states are finding better luck cracking the property ladder for the first time, while others have been left behind as house prices continue to defy gravity.
Queensland’s Toowoomba has become the “sanctuary” for first-home buyers, with a fifth of all first-home buyer transactions in the state located in this regional city, the data revealed.
Meanwhile, it appears Australians have been flocking to Tasmania to buy their first home: 12 per cent of transactions in the state occurred in Lenah Valley, followed by neighbouring North Hobart at 11 per cent.
Tranmere was also a popular suburb, scooping up 9 per cent of all first home buyer transactions.
Meanwhile, those wanting to buy their first property in NSW and Victoria are seriously struggling, with very few suburbs to choose from.
Described as the “polar opposite” of Queensland, NSW sees the least concentration of first home buyers of all the Australian states and territories.
The Greater Western Sydney suburb of Pemulwuy claimed 2 per cent of first home buyer transactions in Australia’s greatest state, while all other purchases not individually representing more than 1 per cent of the total.
Victorians are also familiar with this narrative; the top suburbs among first home buyers in this state are Devon Meadows and Roxburgh Park, both claiming a small 2 per cent of transactions each.
Otherwise, the transactions in this state are littered across many different areas, much like NSW, with “no clear first home buyer sanctuaries to be found here,” HashChing’s analysis said.
Many Aussies in the ACT are finding refuge in the outskirts of Canberra particularly in the suburb of Dunlop, with 11 per cent of all first home buyer transactions, followed by Kambah and Amaroo both with 10 per cent.
South Australia is also reasonably popular, with 8 per cent of first home buyers settling in Port Lincoln, as well as the South Adelaide suburbs of Flagstaff Hill and Ascot Park (both home to 6 per cent of transactions).
First home buyers in Western Australia have found homes in Bunbury (6 per cent), Persall (5 per cent) and neighbouring Mullaloo (4 per cent).
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‘Market failure’: NSW, Victoria letting down first home buyers
HashChing CO Arun Maharaj said the team had a hunch that first home buyers would likely find homes in similar areas.
“The group has the most in common with each other - younger, lower budgets and often employees over self-employed. This would lead to areas with a sweet spot of good commuting options into capital cities, affordable housing and/or nearby recreational areas seeing high transaction numbers,” he said.
And while the data revealed this was largely true for Queensland, Tasmania, WA, SA and the ACT, the situation was very different in NSW and Victoria.
“The wide range of postcodes in NSW and VIC suggests only one thing: market failure,” Maharaj said.
“The housing market has not created appealing centres of entry-level property for this embattled group.”
It’s forced first home buyers to save more, compete with those who are already higher up on the property ladder, and look outside their state for their first home.
As a result, Hobart and Adelaide have both seen a boom in first home buyer transactions, Maharaj added.
“What’s happening in Queensland however shows that there is hope … NSW and Victoria should take notes,” he said.
The regional Queensland city has created the perfect mix of affordable housing, job opportunities and transport making it an attractive destination to settle down in, he said.
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