The expanded five percent deposit scheme, now available for homes priced up to $1 million, should be a game changer, but eligibility only matters if there are enough homes below that threshold.
At the moment, the number who do is declining rapidly.
Our latest Ray White analysis of the Gold Coast market alone shows that affordable home sales have more than halved in just four years.
In 2021, more than 35,000 homes in the city sold under $1 million.
Today, that rolling annual figure is just 16,642.
The number of units experienced a similar decline, from approximately 17,000 to 11,720 in the same period. This sharp drop in affordable supply means significantly fewer opportunities for buyers accessing the scheme.
Even more worrying, only one in four detached homes on the Gold Coast now sells below the $1 million threshold.
For units this is about seven in ten.
This is better, but still declining every year as price growth continues to outpace supply.
Where housing is still feasible, competition is fierce.
Coomera and Pimpama, two of the region’s fastest growing suburbs, dominate in terms of homes under the limit, accounting for almost 500 eligible sales in the past year.
13 Burghardt Court, Pimpama, sold for $985,000
In terms of units, Surfers Paradise towers above the pack with 856 sales under $1 million, followed by Southport and Labrador.
Units in Surfers Paradise do the heavy lifting. Photo Glenn Hampson
These bags essentially carry the weight of affordability in a city where new developments are increasingly focusing on premium products.
The story behind the figures is simple: demand continues to rise while supply remains limited.
Interstate migration to the Gold Coast is among the strongest in the country.
Investor activity has returned, providing much-needed rental supply, but they are competing with first-home buyers.
Downsizers want to stay local.
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And due to construction delays and high construction costs, the new supply is lagging far behind what is needed.
Government support has overwhelmingly stimulated the demand side of the market, allowing more first home buyers to compete.
Without the five percent deposit system, many would continue renting indefinitely.
But stimulating demand in itself has consequences. The increased borrowing power is chasing a shrinking pool of eligible homes, driving prices higher instead of improving actual affordability.
This is where the next phase of the affordability problem lies.
Ray White Chief Economist Nerida Conisbee
The plan opens the front door, but planning and delivery decisions determine whether there is a house behind it. We must act quickly to realize more diverse medium-density options – townhouses, smaller single-family homes and high-end mid-rise developments – especially in suburbs that still offer a viable path to ownership.
The dream of home ownership remains alive on the Gold Coast.
But without a meaningful increase in supply, especially at the entry level, that dream will continue to remain further out of reach.
The five percent deposit system has created opportunities. Ensuring that enough homes are priced to meet demand must be the priority now.
*Nerida Conisbee is chief economist of the Ray White Group
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