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How to avoid mortgage stress: This is what you need to earn in every Australian city to buy a home 

Despite house prices dropping in most Australian cities earlier in the year, new data is showing you still need a huge salary to buy a home.

Potential buyers still need to earn six-figure salaries to enter the housing market comfortably and avoid what is being called ‘mortgage stress’.

Mortgage stress is when 30 per cent or more of your income goes towards repayments, according to RateCity research director Sally Tindall.

New data has shown home-buyers could still need a six-figure salary to comfortably enter the housing market (stock image)

data suggest first-home buyers are going to struggle to get started in the market (stock image)

Data suggest first-home buyers are going to struggle to get started in the market (stock image)

‘Everyone has bills to pay, mouths to feed and kids to educate. People are struggling to make ends meet as it is,’ Ms Tindall told News.com.au.

‘When your mortgage repayments tip over that 30 per cent mark, it means you’ll struggle to have spare cash to get you through month-on-month.’

SALARY REQUIRED TO AVOID MORTGAGE STRESS IN YOUR CITY

Adelaide: $75,556 (house) and $53,220 (unit) 

Brisbane: $87,343 (house) and $62,011 (unit) 

Canberra: $109,624 (house) and $71,528 (unit) 

Darwin: $82,282 (house) and $50,356 (unit) 

Hobart: $74,076 (house) and $58,561 (unit) 

Melbourne: $131,830 (house) and $92,280 (unit)

Perth: $78,088 (house) and $64,026 (unit)

Sydney: $161,859 (house) and $121,026 (unit)

RateCity has calculated the annual income needed to purchase a house or unit in Australia’s capital cities, based on median house prices and upfront costs.

Sydney’s housing market proves to be the most expensive once again.

A potential buyer would have to be on a salary of more than $161,000 to purchase a house in Sydney and avoid mortgage stress.

Even a unit would require a $121,000 salary.

The median house price in Sydney is still nearly $1million, with upfront costs averaging more than $240,000. 

On the cheaper end of the scale, people looking to buy a house on a smaller salary should look at Hobart, where the necessary salary is said to be $74,076.

For a unit, the lowest salary necessary is in Darwin, where a buyer can comfortable enter the market on $50,356 a year. 

In particular, first-home buyers are about to feel the squeeze. 

When your mortgage repayments tip over that 30 per cent mark, it means you'll struggle to have spare cash to get you through month-on-month,' a market expert says (stock image)

When your mortgage repayments tip over that 30 per cent mark, it means you’ll struggle to have spare cash to get you through month-on-month,’ a market expert says (stock image)

The average 21 to 34-year-old earns about $56,000 a year, according to the Australian Bureau of Statistics. 

The research from RateCity says that the least someone can earn to avoid mortgage stress before buying a house is $74,076, and that’s only in Hobart.

Research shows young Australians are living with their parents for longer, due to the high cost of living and unprecedented levels of debt. 

A report by the Australian Securities and Investments Commission warns that young people are getting themselves into trouble by overextending credit card debt.

The average house in Brisbane (pictured) costs $87,343, more than $30,000 than the average salary of a 21 to 34-year-old

The average house in Brisbane (pictured) costs $87,343, more than $30,000 than the average salary of a 21 to 34-year-old

Read more at DailyMail.co.uk


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