How young Australians are navigating housing affordability
The gap between first-home buyer incomes and median property prices is at a 40-year high. Here's how the under-35 cohort is actually getting in — through schemes, family, rentvesting and shared ownership.
The numbers are bleak on paper. The median first-home buyer needs to save about 10 years of household income for a 20% deposit on a median capital city home. So how are people under 35 still buying in 2025–2026?
The 5% deposit scheme is doing real work
The First Home Guarantee — and its expansion from October 2025 — is the single biggest accelerant. By letting first-home buyers in with a 5% deposit and no LMI, it cuts the deposit timeline by roughly two-thirds. Around 50,000 buyers a year use it, and the expanded eligibility (higher caps, broader income brackets) is set to push that number higher in 2026.
Family guarantees are mainstream now
A decade ago, family guarantor loans (where parents pledge equity in their property as additional security) were niche. Today they're standard. Around 1 in 7 first-home buyers in our pipeline use some form of family security. Most lenders treat them well — the parent's exposure can be released once the borrower has built sufficient equity.
The structural shift: this is no longer about parents "giving" a deposit. It's about leveraging the household's combined equity to bridge the affordability gap, with clear terms and a defined release timeline.
Rentvesting works for the right profile
For young Australians anchored in expensive cities by work or lifestyle, rentvesting — renting where you want to live, buying where you can afford to invest — is increasingly common. It gets you on the property ladder without committing to a long commute, and the investment property's negative gearing can support cashflow.
It's not for everyone. It works when you're disciplined about treating the investment as a financial asset, not a future home.
Co-buying with friends
Newer, but growing. Two or three young buyers pool deposits and borrow jointly. Lenders accept the arrangement; what matters is having a tight legal agreement on exit, contribution rules, and what happens if one party wants out.
Saving longer in super
The First Home Super Saver Scheme remains underused. It lets first-home buyers contribute extra to super and withdraw it (plus deemed earnings) for a deposit. For a high-income earner, the tax savings can be substantial — often $5k–$10k extra in their deposit pocket.
The honest take
The path is real, but it requires more planning and more openness about family arrangements than previous generations needed. The first conversation we usually have with a young buyer is mapping which combination of these levers actually fits their life — and what that means for a realistic purchase timeline.
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