Australian houses cost $66,000 less than what they were two years ago, yet household wages have risen by almost $20,000 in five years. The changes mean it's now very realistic for homebuyers to get into the market, according to RateCity.
Chief executive officer Damian Smith says saving for a home in 2011 is much easier than it was five years ago and especially two years ago.
"Buying a home and paying off a mortgage is something most Australians strive for. It got much harder towards the end of 2008, but since the global financial crisis affordability has improved, due to lower housing prices and continued income growth for most Australians," he says.
"The average Australian home now costs $417,500, which is $66,000 less than the average house price from two years ago and pretty much the same as five years ago."
Median household income continues to rise at an average annual rate of more than seven per cent, since 2006. Median household income in Australia also now sits at just under $77,000, compared to just over $54,000 in 2006.
"It's certainly true that the rich have got a lot richer in Australia over the last few years - but middle Australia is doing better on the income side than some of the doom and gloom stories might suggest."
He adds that because of declining property prices and consistent income growth, a 10 per cent deposit in 2009 was just over $48,000, whereas in 2011, the equivalent figure is just under $42,000.
"If you've got money to invest towards a home loan deposit, it's a better time to save now than in 2009, because savings interest rates are higher and there are now more attractive savings incentives for first homebuyers.
"That, combined with higher incomes on average, means borrowers today are in a better position to save larger deposits and ultimately shave thousands of dollars in interest off their future mortgages."
