Western Australia has the most active first home buyers in Australia, but soaring house prices have made property market debutants a rarity in NSW.

In Western Australia, first home buyers accounted for almost one in five loans written in February, closely followed by Queensland and Victoria on equal pegging at 17 per cent, figures from Mortgage Choice on Wednesday reveal.

But in NSW, where high prices make buying a home a more daunting prospect and many government incentives have been removed, first timers accounted for less than four per cent of new loans.

“This is largely unsurprising when you consider that the state’s capital, Sydney, boasts the country’s highest median dwelling price,” Mortgage Choice spokeswoman Jessica Darnbrough said.

Sydney’s median dwelling price of $680,000 is the highest of all Australian cities – $150,000 higher than closest rival Darwin.

In comparison, first time buyers in Queensland enjoy stamp duty concessions for established properties, along with a far lower median dwelling price of $452,000 in Brisbane.

Australiawide, first home buyers are having a tough time breaking into the market, forced to compete with investors, attracted by low interest rates, being driven to housing.

First home buyers accounted for just 12.4 per cent of home loan approvals in February, down from 15.8 per cent in the same month last year, according to Mortgage Choice figures.

Treasurer Joe Hockey has proposed allowing first home buyers to dip into their superannuation to help them get into the property market.

But Ms Darnbrough expects a slight pick up in first home buyer activity in the near future as low interest rates and proposed government incentives lure new buyers into the market.

“Some state governments have suggested that they will introduce various new first home buyer incentive programs if elected,” she said.

“If these promises come to fruition, we should see a small lift.”



  • NSW – 3.9 pct of new home loans
  • SA – 4.7 pct
  • VIC – 17 pct
  • QLD – 17 pct
  • WA – 19.6 pct


By Warwick Goodman
  • Housing is the national problem that will not go away. Fixing it by first home buyer grants, stamp duty relief and dipping into retirement savings is not the answer. We have already dragged into the market all that can qualify using these tools – they are short term at best and only help drive up prices.
    Housing policy is heavily influenced by powerful lobby groups who have a vested interest in large projects, involving huge sums of money, generating huge fees and profits. Most talk of housing affordability in one breath and do the opposite in reality. I am aware of one major land developer who sold a block in SW Sydney to a couple who deposited and failed with finance on valuation. The developer subsequently on sold the block at $20 k more.
    You can't blame developers for maximising profits. But you need to take what they say with caution. Housing self-sufficiency is a huge challenge and it is hard to imagine same as, same as governments changing from their worn out ideas in this space. It does not just affect first home buyers as many over 55 will now be looking towards large mortgages at retirement.
    Banks will also have to stop seeing home equity as a redraw facility.