A mother-and-daughter duo who are trying to save up for their first home in three years are now struggling to find the cash.
“I can’t keep up with the mortgage payments, I’m getting worried about our finances,” said mother-of-two, Tatjana Care.
“We’ve had to borrow $400 a month for food and rent and groceries and things like that, but we’ve got to get a mortgage.”
Care and her husband have been in a home rental business for six years and are currently in the process of buying their first rental property.
But they’ve struggled to find a home for the couple’s two children, ages five and eight.
“They’re two, but they’re a bit older,” said Care.
The couple recently moved into a new apartment with their children in Sydney’s inner-west and have spent a lot of time on the couch with the kids.
“It’s hard because they’re older and we’re older, but there’s just nothing for them to do.”
They are now trying to make ends meet through renting out their home to others.
But despite the family’s struggles, they say the money is there for them.
“If we could have got into a property that wasn’t a rental and we could be comfortable with it and it wasn’t in our name, then we would have,” said Lovell.
“The money has always been there, but now it’s not.”
For some, the struggle of finding a mortgage for a new home has led to an expensive move to another city.
“When I moved from my home to New York, it was $400,000,” said Jodi Kroll.
“Now it’s $600,000.”
It’s not just people struggling with mortgage payments that are struggling.
More than two-thirds of Australians say they have had to make a decision between renting a home or buying a property, according to a recent survey by the Australian Bureau of Statistics.
The cost of buying a home in Australia is expected to rise by nearly 2 per cent by 2026, according a survey commissioned by the Property Institute of Australia.
A new study by the Commonwealth Bank of Australia says the average price of a house in Sydney is now $4.8 million, compared to $2.7 million in 2012.
“What this really shows is that there are still people who have the ability to buy a property in Australia,” said Bank economist John Dutton.
“That’s what’s driving the housing market.”
In a report to the NSW Parliament last year, Mr Dutton said the average annual price of housing in the state was $3.1 million, while the average cost of a detached house in NSW was $1.4 million.
“Given the strong growth in house prices and the affordability pressures, we are seeing households looking to take a larger proportion of the value of the property portfolio,” he said.
“This has led us to see a shift in the types of houses we are focusing on in NSW.”
The Property Institute says the housing bubble is being fuelled by a lack of supply in the market, particularly in Sydney, which is currently experiencing the largest increase in house price growth since the Great Recession.
“Our research shows that more than a quarter of homes are now either underwater or not in the hands of potential buyers,” said Simon Latham, director of research and economic modelling for the Institute.
“As a result, the value and affordability of property is increasing, and it’s affecting the rental market.”
Mr Latham said the problem with the property market is a lack to buy properties, especially in the Sydney CBD, which he said is experiencing the highest demand for properties for people to live in.
“In the last year or so, we’ve seen an increase in demand in the CBD, especially around the western suburbs, for new dwellings,” he told the ABC.
“There’s not much available, and that has driven up prices.”