SA buyers’ Great Australian Dream becoming impossible

The list of suburbs available to median-income earning South Australians, without putting themselves into mortgage stress, is shockingly small – five to be exact. See what your income buys.

Unless they buy a home with a friend or partner, a South Australian earning median income can afford to buy a median-priced house in just five Adelaide suburbs without putting themself in mortgage stress.

Finder’s analysis of PropTrack data paints a grim picture of the rising affordability crisis in SA, revealing a single median-waged buyer can only afford to buy in Elizabeth Park, Smithfield Plains, Elizabeth Downs, Davoren Park and Elizabeth North without spending more than 30 per cent of their income on mortgage repayments.

All incomes displayed below are after-tax wages.

PropTrack data shows Adelaide’s median house price is $654,000, and its median unit price is $440,000.

Finder’s analysis shows, in order to avoid spending more than 30 per cent of a buyer’s income on repayments, househunters needed a minimum after-tax salary of $81,391 to buy a median-priced home, and an after-tax salary of at least $54,759 to buy a median priced unit.

ABS data shows South Australia’s median total income sits at $50,440, with moneysmart.gov.au’s online tax calculator revealing the income after tax would be $42,572.

Finder.com.au head of consumer research Graham Cooke said the nation’s deteriorating affordability was clearly evident.

“These figures may be pretty shocking to some – with the average price increase across all suburbs sitting at 13 per cent,” he said.

“This has added thousands of dollars to the average salary required to afford a home in most cases.

“The costs of living are increasing faster than people’s salaries and housing is the biggest component of that – a lot of households are struggling.”

Finder head of consumer research Graham Cooke

Turner Real Estate CEO Emma Slape.

Finder’s calculations are based on an interest rate of 5.95 per cent – the most recent owner-occupier variable discounted rate as supplied by the RBA, with the full rate rise applied for any cash rate increases – a 30–year mortgage and a 20 per cent deposit.

Mr Cooke said housing affordability pressures were hitting first-home buyers the hardest.

“First-home buyers usually have more debt,” he said.

Those looking to buy a unit on a yearly salary of $42,572 have less choice, with just Salisbury and Salisbury East within reach, while 41 regional towns have houses affordable to those on SA’s median post-tax wage.

Turner Real Estate chief executive officer Emma Slape said Government assistance would help young people enter the market, provided it was carefully considered.

“There is no doubt it’s getting harder and harder for younger people to break into the property market, however any Government incentives need to be carefully crafted to ensure that they don’t drive the market higher causing a greater affordability gap,” she said.

“Stamp duty is also a major cost to housing and reform in this area could definitely improve affordability, particularly if it is targeted at relief in the first homebuyer market price ranges.”

Newlyweds Liam and Amy McGoldrick rent while they save for a home. Picture: Emma Brasier

Turner Real Estate’s sales client service team Amy McGoldrick, 29, and her cabinet maker and DJ husband Liam, 34, are renting in Rosewater as they save to buy.

“We’re lucky that we both have jobs because I genuinely don’t know how we would do it on one income,” she said.

“We’ve been saving for three years and are still 12 months off buying.

“I don’t know how a single person already renting would be able to save a deposit on top of that.”