Mortgage market update | Stamp duty explainer | Deposit times fall

We've made it to autumn! As the season changes, so does the finance and property landscape. Here are four stories making headlines right now:

  • Why stamp duty keeps rising

  • Deposit times fall

  • Banks getting more cautious

  • Rental market easing

Read more here Mortgage market update

Over the past four decades, there's been a big increase in stamp duty costs relative to the price being paid by buyers.

During that time, Sydney buyers have seen their stamp duty bill increase from a rate equivalent to 2.0% of the purchase price to 4.0%, according to joint research by PropTrack and the e61 Institute. Stamp duty costs have also risen from 2.0% to 5.4% in Melbourne, 1.0% to 2.6% in Brisbane and 2.5% to 4.6% in Adelaide.

PropTrack Senior Economist Angus Moore pointed the finger at ‘bracket creep’, which happens because stamp duty rates are progressive (i.e. more expensive properties are charged higher rates of stamp duty).

Bracket creep wouldn't happen if state governments kept raising stamp duty tax brackets at the same rate as property prices. But because this hasn't occurred, stamp duty has become relatively more expensive.

First home buyers entering the market sooner

Despite the increase in the national median property price over the past year, it’s actually become slightly easier for the typical first home buyer to get on the property ladder.

That’s because first home buyers have increased their earnings by even more, thanks to higher savings rates and wages, according to Domain research.

Between February 2023 and 2024, the time to save a house deposit fell by two months, to 4 years 9 months, while the time to save a unit deposit fell by one month, to 3 years 5 months.

Domain assumed first home buyers:

  • Were a couple aged between 25 and 34 years.

  • Earned an average salary for someone their age.

  • Bought an entry-level property ranked at the 25th percentile in terms of price (with the 1st percentile being the cheapest home and the 100th being the dearest).

If you want to buy your first home, one way to accelerate the process is to use the federal government’s First Home Guarantee or Regional First Home Buyer Guarantee schemes. These let eligible first home buyers purchase a property with just a 5% deposit, without needing to pay lender’s mortgage insurance. However, not all first home buyers are eligible: income caps apply, as do property price caps.