NSW Premier Gladys Berejiklian has announced changes to stamp duty from July 1.
- Help for Sydney’s first-home buyers ‘inadequate’ as entry-level properties push past NSW government threshold
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The most affordable spot for Sydneysiders looking to buy their first home is so far from the city it barely counts as Sydney at all.
Gosford, a 75 kilometre drive from Sydney’s centre, on the Central Coast and the cusp of the Greater Sydney, is the cheapest area for first time buyers.
Domain Group’s First Home Buyers Report, released on Friday, deemed just 11 suburbs “affordable” – under $459,010 – based on the average New South Wales first home buyer loan size in the 12 months to March in addition to a 20 per cent deposit.
This two-bedroom townhouse sold in May for $410,000 – just short of Gosford’s median house price of $412,500. Photo: Supplied.
If you include the $10,000 boost from the First Home Owner Grant for new properties an extra six suburbs are rendered affordable – 17 in total.
“Declining affordability is pushing first home buyers further and further out,” Domain Group data scientist Dr Nicola Powell said. “The Central Coast and the city’s west is where they’ll still find affordable houses.”
Despite a lengthy average commute time of an hour and a half, Gosford’s median house price of $412,500 was attracting more young Sydneysiders willing to make the daily trip to Sydney for work.
The First Home Buyers Report found a limited number of affordable suburbs in Greater Sydney. Photo: Rob Homer
“We have a lot of young couples moving up here for their first home … over the last three years, that’s really become a trend as house prices in Sydney become out of reach,” Debbie Grinham, of LJ Hooker Gosford, said.
“When they look at it, they see they could be spending the same amount of time getting the train from Gosford as it might take them to get in from the western suburbs.”
Within that budget and 50 kilometres west of the Sydney CBD is Willmot, wedged between Marsden Park and Penrith in the city’s west. It comes with a bad reputation, but a median price of $440,000.
This three-bedroom home on Willmot’s Captain Cook Drive sold for the suburb’s median house price of $440,000. Photo: Supplied.
While those in the market for an apartment have more options – with 36 suburbs with a median below $459,010 – the closest suburb, Lakemba, is still 15 kilometres from the CBD.
“While they may not be able to get into their suburb of choice, or buy where they want to live, there are still options,” Dr Powell said, noting a growing number of young buyers were turning to rent-vesting.
The release of the report coincides with changes to the stamp duty exemption for first home buyers announced by the state government on Thursday. As of July 1, first time buyers won’t have to pay stamp duty on existing or new properties under $650,000.
But the move by the government only serves to highlight the growing gap between what first home buyers can afford and the reality of Sydney house prices.
There are just four Sydney suburbs left within 40 kilometres of the CBD with a median house price below the $650,000 threshold.
Ashcroft, 35 kilometres south west of the CBD, is the closest with a median of $635,000. Also under the price range are the nearby suburbs of Heckenberg, Cartwright and Busby.
When it comes to units, Eastlakes – just eight kilometres south of the CBD – surprisingly just scrapes in with a $650,000 median price.
Petersham also makes the cut, with a median of $645,450, as does Ryde at $650,000.
“It all seems pretty feeble to me,” said Hal Pawson, Professor of Housing Research and Policy at the University of New South Wales, of the government’s announcement. “If this is all there turns out to be [for housing affordability in the budget] then it’s pretty disappointing,”
He said stamp duty concessions could increase demand and therefore prices.
Taj Singh, from First Home Buyers Australia, was more upbeat about the government’s decision.
“As saving for a deposit and associated costs is the toughest part of the journey for a first home buyer this will definitely help, especially for those looking to buy an established apartment or entry-level home,” he said.
“Some will argue that it will put an upward pressure on prices but that is not necessarily the case.”
