How Buying a Unit Can Fast-Track Your First Home Ownership Journey

For many Australians, buying a first home feels like an uphill battle, with property prices outpacing wage growth and the cost of living continuing to rise. However, recent research from Domain’s First Home Buyer Report 2025 suggests that purchasing a unit instead of a house can significantly cut the time needed to save for a deposit—by nearly two years on average across the country.

If you're a first-home buyer wondering how to enter the property market sooner, this guide will walk you through the advantages of choosing a unit, how different cities compare, and strategies to make homeownership a reality faster.

The Growing Appeal of Units for First-Home Buyers

With the dream of homeownership becoming increasingly challenging, more first-home buyers are turning to units as an affordable entry point. According to the report, saving for a unit deposit is 20 months faster on average compared to saving for a house deposit in Australia’s capital cities.

This time-saving advantage is even more pronounced in high-priced markets like Sydney, where purchasing a unit shaves two years and five months off the saving timeline compared to a house. Similarly, Canberra buyers can enter the market two years and four months sooner by opting for a unit.

While the decision between a house and a unit depends on individual lifestyle needs and long-term goals, the financial benefits of choosing a unit can help first-home buyers achieve their homeownership dreams much sooner.

Which Cities Offer the Shortest Saving Times?

Saving time for a 20% deposit varies across Australia’s capital cities, with some locations offering a significantly shorter pathway to homeownership than others. Here’s how different cities compare:

• Sydney: The toughest market for first-home buyers, requiring the longest time to save. However, purchasing a unit in Mt Druitt (3 years, 2 months) is the quickest way to enter the market in the city.
• Melbourne: The only capital city where saving times have decreased for both houses and units over the past five years. Essendon (2 years, 9 months) offers the shortest save time for units.
• Brisbane: With rising property prices, saving times have increased. However, Springwood-Kingston (3 years, 5 months) remains an accessible location for unit buyers.
• Perth: One of the most affordable capital cities, with Perth City (2 years, 7 months) offering the fastest saving time for a unit.
• Adelaide: A rising market where affordability is shifting. Unley (3 years, 5 months) is the best option for unit buyers.
• Canberra: Woden Valley (2 years, 10 months) provides a faster route to homeownership than other areas.
• Darwin & Hobart: Data for units is limited due to lower sales volumes, but entry-level house deposits are more achievable in these cities than in larger markets.

Why Is Saving for a Unit Easier Than a House?

The time required to save for a home is influenced by various factors, including property prices, wage growth, and interest rates. Several key reasons contribute to the shorter saving period for units:

1. Lower Entry Prices

   • The median price of a unit is typically much lower than that of a house, meaning a 20% deposit is easier to accumulate.
   • Over the past five years, entry-level house prices have increased by 58%, whereas unit prices have risen by only 27%, making units a more affordable option.

2. Stable Unit Prices

   • Unlike houses, which have seen significant appreciation in value, units have maintained more stable prices in many cities.
   • This means that first-home buyers do not have to chase rapidly rising deposit requirements.

3. Better Rental Yield and Investment Potential

   • For buyers looking to rent out their property in the future, units often provide better rental yields than houses, particularly in high-demand urban areas.
   • This factor makes units an attractive long-term investment while also providing affordability benefits.

4. Government Incentives for First-Home Buyers

   • State governments offer various first-home buyer grants, stamp duty concessions, and incentives that can make purchasing a unit even more appealing.
     • For example: Queensland: Recently scrapped stamp duty for first-home buyers on new builds, making units an even more attractive option.
     • New South Wales & Victoria: Offer first-home buyer grants that apply to units, reducing upfront costs.
     • Federal Government’s First Home Guarantee: Allows eligible buyers to purchase with as little as a 5% deposit, significantly reducing saving time.

What Challenges Do First-Home Buyers Still Face?

Despite the advantages of choosing a unit, first-home buyers still encounter significant hurdles in achieving homeownership. Domain’s report highlights a few critical challenges:

• Property prices continue to outpace wage growth. Over the past five years, inflation has surged by 20%, while wages have only increased by 15%, making it harder to save for a deposit.
• High-growth cities like Brisbane, Adelaide, and Perth have seen saving times increase due to double-digit property price growth outpacing income growth.
• Rising competition for entry-level units as more first-home buyers shift their focus from houses to more affordable unit options.

How to Fast-Track Your First Home Purchase

If you’re a first-home buyer looking to speed up your path to homeownership, consider these strategies:

1. Target Areas with Shorter Save Times

   • Research affordable suburbs within your chosen city. For instance, in Sydney, Mt Druitt offers a much faster path to homeownership than more expensive inner-city areas.

2. Leverage Government Grants & Incentives

   • Check your state’s first-home buyer programs, as many offer financial assistance that can significantly reduce upfront costs.

3. Consider Alternative Loan Options

   • Instead of waiting to save a full 20% deposit, explore options such as:
     • First Home Guarantee Scheme (allowing purchases with only a 5% deposit)
     • Lenders Mortgage Insurance (LMI) waivers for first-home buyers meeting eligibility criteria
     • Parental guarantor loans to help secure a property sooner

4. Maximize Savings & Investment Returns

   • Take advantage of high-interest savings accounts to grow your deposit faster.
   • Consider salary sacrificing into superannuation (First Home Super Saver Scheme) to leverage tax benefits while saving.
   • Minimize non-essential spending and automate savings to stay on track.

5. Get Pre-Approval Before You Start Looking

   • Understanding your borrowing power before searching for a property ensures you focus on realistic options within your budget.

Conclusion: Is Buying a Unit the Right Move for You?

For many first-home buyers, purchasing a unit is the key to getting into the property market faster. With shorter saving times, lower entry costs, and solid government incentives, units offer an accessible and strategic way to build long-term wealth.

If your goal is to own a home sooner rather than later, shifting your focus to units might be the smartest financial decision. However, it’s essential to weigh your lifestyle needs, long-term plans, and market conditions before making a final decision.

Need help navigating your first property purchase? Let’s chat! Whether you’re weighing up your options or need expert guidance, I can help you secure the right home at the right price.