Domain 2026: Up to 8 Years to Save a Deposit

Domain's 2026 First Home Buyer Report has confirmed what many Australians already suspect: buying your first home has never been harder. The report finds that saving a standard 20 per cent deposit now takes an average of five years nationally, rising to 7.7 years in Sydney and 6.3 years in Brisbane. Those timelines assume consistent, disciplined saving and no major life disruptions. For first home buyers trying to plan ahead in an environment of elevated rents and rising interest rates, the report provides both a reality check and a roadmap.

How long it actually takes to save a deposit in 2026

The deposit timeline data in Domain's report breaks down by city for a standard 20 per cent deposit target:

• Sydney: 7.7 years for a house deposit
• Brisbane: 6.3 years - and for the first time on record, Brisbane has overtaken Sydney as the city with the longest deposit saving period for an entry-priced unit
• Adelaide: 5.7 years
• National average: approximately 5 years

The report highlights a critical structural mismatch. Over the past five years, national entry-level house prices increased by 68 per cent and entry-level unit prices by 30 per cent. Wages over the same period grew just 21 per cent. The gap between price growth and income growth has created a deposit savings problem that government schemes and even temporary rate relief have been unable to fully close.

It is worth noting that Domain's report was compiled when rate cuts from the second half of 2025 were still fresh in the market. Three rate hikes in 2026 - pushing the cash rate from 3.85 per cent to the current 4.35 per cent - have since tightened serviceability further. The challenge facing first home buyers today is, if anything, more acute than the report's base data suggests.

The repayment squeeze: why getting approved is as hard as saving

Even for buyers who reach their deposit target, the report finds that repayment stress is widespread. For the first time, every Australian capital city is above the 30 per cent of household income threshold for mortgage stress on entry-priced houses:

• Sydney: repayments on an entry-priced house consume 61.8 per cent of median household income
• Brisbane: 50 per cent
• Adelaide: 44 per cent
• Perth: 42 per cent

These figures reflect a market where even buyers who successfully save a deposit face significant ongoing financial pressure. The 30 per cent threshold is the standard benchmark for mortgage stress - spending more than this proportion of gross income on housing repayments is considered financially high risk by most lenders and financial counsellors.

Rising rents are compounding the problem further. When households spend a large share of income on rent while trying to save a deposit, the saving timeline stretches out. Domain's research frames this as a structural shift: tight housing supply and escalating prices have become the primary barriers to first home ownership, not just interest rates.

What first home buyers can do with this information

The Domain report's data points to a clear conclusion: waiting for conditions to improve on their own is a slow path. The most effective strategies for first home buyers combine government support with realistic planning:

• Reduce the deposit target with a government scheme. The First Home Guarantee allows eligible buyers to purchase with as little as 5 per cent deposit and no lenders mortgage insurance. Instead of saving 7.7 years in Sydney for a 20 per cent deposit, a buyer accessing this scheme could be purchasing with a 5 per cent deposit. The scheme now has unlimited places with no income cap.
• Stack available grants and concessions. Depending on your state, first home buyers may also be eligible for a first home owner grant, stamp duty concessions or exemptions, and the federal Help to Buy shared equity scheme. In Queensland, contracts signed before July 1, 2026 still qualify for the $30,000 First Home Owner Grant before it drops to $15,000.
• Use the FHSS scheme for your deposit. The First Home Super Saver Scheme lets eligible buyers save inside superannuation at a concessional tax rate - up to $15,000 per year and $50,000 in total. For buyers in the long deposit-saving phase, this can meaningfully shorten the timeline compared to saving in a standard bank account.
• Model your serviceability at current rates. If mortgage repayments will consume 44 to 62 per cent of your household income at today's rates, buying a lower-priced property or a unit in a more affordable market may produce a better financial outcome than waiting for house prices in your preferred suburb to become affordable.
• Consider whether a smaller deposit with LMI makes sense. Paying lenders mortgage insurance to buy sooner - rather than continuing to save while rents rise - can sometimes be the more cost-effective path. A mortgage professional can help you compare both scenarios with the numbers specific to your situation.

None of these steps guarantee a fast resolution to what is a genuine structural affordability problem. But they represent the most reliable ways to shorten the gap between where you are now and your first home. The government schemes in particular are designed precisely for the kind of market the Domain report describes.

Run the numbers

Use these tools to understand how the Domain report's findings apply to your specific situation:

• Borrowing Power Calculator - see what you can borrow at the current 4.35 per cent cash rate and whether a 5 per cent deposit scheme changes what is within reach
• Grant Stacker - check every grant, concession, and scheme available in your state to see how much you can reduce your upfront costs and deposit saving timeline
• FHSS Calculator - model how much you can save and how much faster you could reach your deposit target by using the First Home Super Saver Scheme
• LMI Calculator - understand whether paying lenders mortgage insurance on a smaller deposit might make financial sense compared to continuing to save to 20 per cent