The great Australian compromise: why many struggle to buy their dream home

It was good fortune rather than good planning that allowed me and my wife to buy a house on Sydney’s northern beaches. With a growing family and a limited budget, we searched for a three-bedroom home close to the city but couldn’t find what we wanted. Having friends on the beaches, we went to an auction in Manly and started bidding. The house we bought was a daggy, ex-rental semi on a busy road, but this was only ever going to be our “stepping stone property” – the best we could afford before moving to our “forever home”. That was 1997, when the median house price in Manly was about $500,000. Now, three-bedroom houses in desirable Manly typically sell for $2.6 million. Twenty years and two major renovations later, our sons have finished school, travelled around the world and started to move out of home (well, kind of). And we’re still here. Our situation is hardly rare. Families, especially in Sydney and Melbourne, have found themselves compromised by the skyrocketing value of surrounding properties. They are “trapped” in their homes for years longer than they intended. Many buyers hop onto the mystical property ladder but never get a chance to live in the home that best suits their needs or desires. The data backs this up. While property values have climbed rapidly, notably in Australia’s largest cities, the number of properties that have sold has plummeted. According to The Australian Affordable Housing Report 2017-18, the number of sales fell from 632,680 over the 12 months to May 2002 to 477,101 in the year to May 2017 – a drop of 24.6%. How much can I borrow?Use UNO's calculator to estimate your borrowing capacity. Calculate NowCoreLogic research shows that owners across Australia now hold on to their properties for much longer. In 2004, a capital city house was owned for an average of 6.8 years. By 2014, the average was 10.5 years for houses and 8.7 years for units. Many of these homeowners are struggling to afford their mortgage repayments, too, despite record low interest rates. Although capital-city home prices jumped 35% in the five years between 2011 and 2016, the most recent census found almost a third of Sydneysiders who don’t own their home outright spend more than 30% of their monthly income on mortgage repayments. Property expert Louis Christopher, from SQM Research, isn’t surprised people feel trapped. “This notion of ‘once you buy, you’re on the property ladder’ can be a bit of a furphy,” he says. “My view is when the market rises, those properties that are further up the ladder can be just as difficult, if not more so, to transact into.” Christopher offers the simple example of a first homebuyer who settles on a $500,000 home but has her eye on a $1 million property up the road. If the market grows by 50% over five years, her property is worth $750,000 but the million-dollar property is now valued at $1.5 million. “In absolute dollars, the $1.5 million property is worth now an additional $250,000 over and above the first property,” he says. “The difference between the two properties was $500,000. Now it’s $750,000. “That said, you’re certainly better off than not buying the $500,000 property to begin with.” Owners looking to upgrade to their dream home in a rising market have a few options. One is to refinance to find a home loan that improves their buying power (try UNO’s refinance calculator). Another is to relocate to a more affordable region or state. The latest property trends suggest that Sydney property values have finally started to come off the boil and the market in places such as Hobart is becoming more competitive. How much can I save by refinancing?Use UNO's calculator to estimate your savings. Calculate SavingsChristopher isn’t sure Tasmania’s property values are rising just because people living in Australia’s biggest cities are looking for their forever home. “Tassie is moving up through a combination of factors, including its better economy,” he says. “Affordability would be one of the reasons, though.” It was certainly a major factor eight years ago for Winsor and Tereza Dobbin. They had put up with things they didn’t like while living in inner-city Leichhardt – excessive noise, slow traffic, “the whole Sydney catastrophe” – and spent much of their money servicing a mortgage when they would rather have been travelling. So, they decided to move to Cygnet – a quiet village 40 minutes from Hobart. The Dobbins bought a four-bedroom 1890s vicarage close to town on a triple block, which gave them the chance to grow fruit trees and have some chickens. “All the local shops are on our doorstep, and you can walk to get some coffee or go to the deli just like you could in Leichhardt,” says Winsor, a freelance writer. “The work here is a bit up and down and you can’t walk into town and get a takeaway but it’s peaceful, we’re 300 metres from the waterfront, the NBN’s fine and it’s less than an hour from the airport.” Tereza is also pleased they chose to escape the city. “All we were doing was going to work to pay the mortgage,” she says. “This is definitely our forever home.” Need a home loan?UNO. The new way to get a better deal. Get StartedBook a call in with UNO

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February 19, 2024
We chose Uno Home Loans from their impressive web site knowing we were going to find it hard, on many fronts, to qualify for a home loan. We were incredibly fortunate to be assigned Mike Parsons as right from the get-go, despite the complexities, he hit the ground running for us. He was incredibly knowledgeable, with years of experience but what was immediately apparent and impressive was that he was totally invested in getting us over the line, doing absolutely everything possible, including working around the clock. Despite it being a relatively small loan in the order of things, Mike never missed a beat, getting docs ready, following up and answering every request from the proposed funder immediately. He kept us informed on progress the minute anything happened, and again if anything needed to be done, he was right on it. In short, we highly recommend Uno, and Mike, knowing what a remarkable job he did, over many weeks, to get us our loan. He got us a great deal, with far better rates than we expected, so we couldn't be happier. In fact, without doubt, you'd be hard pressed to find a more personable, sharp, hard working, dedicated professional who clearly prides himself on getting his customers standout results.
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January 15, 2024
I cannot help but congratulate Scott Wilkinson of UNO Home Loans for being an absolute credit to both his company and the entire loans industry. Scott is a truly rare gem of a broker in that he will not only go the extra mile to achieve for each customer the very best deal, but his knowledge of all and sundry within the industry is unsurpassed (you will see what I mean if you speak to him). Additionally, Scott has a clear passion for imparting his wealth of information with each customer, whereas the conversation with most other brokers would simply be over if they could not get you the best deal. For me, Scott Wilkinson of UNO Home Loans stands head and shoulders above the competition and I feel privileged to benefit both from his expertise and professionalism whenever it is time for a refinance or new loan.
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January 11, 2024
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December 20, 2023
Thank you Eren Tan for the amazing service and support. Our Loan was a little tricky and complex for other lenders but Eren managed to get it over the line in record time. His professionalism and dedication to our needs was exceptional. If you need a Loan no matter how complex your situation, make sure you contact Eren at UNO Home Loans.
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Buying & selling a house at the same time is very stressful but Scott Wilkinson from UNO home loans made sure we knew what was happening & took most of the stress away. He always kept us up to date and if we had a concern or wanted clarification on something we were able to call him, if he didn’t know the answer straight away he will find out and contact us back.. now we are enjoying our new house and turning it into a home :)
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December 18, 2023
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December 11, 2023
To be able to recommend Scott Wilkinson for your mortgage broker was a privilege. We had deals fall through but Scott supported, guided and stuck with us, proper partnership. The whole team at UNO helped us and supported us right through to after settlement. Made sure everything was correct and how we are progressing. Communication was amazing and straightforward and easy to understand. Transparent. We can not Recommend Scott and the team as Uno high enough. Use UNO with confidence.
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If you’re looking for a trustworthy, thorough, reliable & knowledgeable Mortgage Broker then you must call Anita Callaghan! I can’t even imagine how stressful this process would’ve been without her. Anita went above and beyond to make sure she answered every question, responded to every text (even on weekends/after hours), and followed up on every detail to ensure we had all the info we needed. Anita is a true people person who is warm, empathetic, kind and supportive. You can tell she loves helping people and loves what she does, which is probably why she’s so good at it! Can’t thank you enough Anita, or recommend you more highly! You’re the best!
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