4 ways owning a home in the 80s was different to owning one today

We travel back in time to 1984.

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In a recent finder.com.au study, we compared various home ownership factors of 1984 - the average mortgage size in relation to income, mortgage repayments, interest rates, and property prices- with the same factors today to discover that despite the higher costs of living that we currently face, Australians are still taking out mortgages to pursue homeownership.

home loans in the 80s vs today infographic

1. Mortgage Sizes

The average mortgage size for Baby Boomers in 1984 was twice the amount of their average income, whereas today our mortgage size is quadruple the amount that we earn.

The average mortgage size in 1984 was $37 542 with an average annual salary of about $19 000. Whereas today, the average mortgage size is $334 000 with an average annual income of $79 000.

In 1984, 23% of your income would have gone towards your home loan, whereas now 29% of your income will go towards your home loan.

The average mortgage has increased by 790% but the average income has only increased by 316% over 30 years.

This trend has given rise to many borrowers experiencing mortgage stress, which occurs when your mortgage repayments constitute 30% or more of your total annual income.

2. Mortgage Repayments

Monthly mortgage repayments are four times higher than what they were 30 years ago- rising from $372 to $1 896.

3. Interest Rates & Property Prices

In 1984, you would have seen a higher interest rate. Today, on the other hand, the Reserve Bank has continued to ease monetary policy by lowering rates, making home finance cheaper, which has played a part in fueling demand and higher housing prices.

finder.com.au money expert, Michelle Hutchison says: "The concerning part is that interest rates are half of what they were 30 years ago, with the average standard variable rate currently about 5.5 percent compared to 11.5 percent in 1984."

The average Australian property value currently sits at $580 000 compared to $66,042 30 years ago. With the Reserve Bank’s easing of monetary budget, lower interest rates have contributed to the fuelling of Australian property prices.

4. Rent VS Buy

In 1984, 8% of the population rented and now 10% of the population rent. On the contrary, there has been a more significant change in the number of Australians taking out a mortgage, from 4% to 12% over 30 years.

Despite the tough conditions for Australian homeowners, such as increased mortgage sizes in relation to annual income, and escalating property prices, we have still seen a rise in the number of people taking out a mortgage. Four times more households today are taking out a mortgage when compared to 1984.

Michelle Hutchison points out that property is still a worthwhile investment: “If this trend continues, homeowners can expect the average property of $580 000 to be worth $4.6 million in 30 years time.”

“Even if it takes you another five years to save for a deposit, it’s worth getting into the property market when you can if you compare it to the past 30 years of returns.”

Scanning over the past 30 years of returns and with historically low interest rates, property is still a valuable investment in Australia’s market.

*This research is based on projected estimates and actual figures from Australian Bureau of Statistics, Australian Taxation Office, Reserve Bank of Australia and analysed by finder.com.au.

Need a home loan? Start comparing

$
years
Name Product Interest Rate (p.a.) Comp. Rate^ (p.a.) Application Fee Ongoing Fees Max LVR Monthly Payment
Westpac Fixed Option Home Loan Premier Advantage Package
1.99%
3.48% p.a.
$0
$395 p.a.
95%
$554.81
Up to $3,000 refinance cashback.
Lock in a low fixed rate for 2 years and buy your home with a 5% deposit. Eligible borrowers refinancing $250,000 or more can get up to $3,000 cashback. Other conditions apply.
UBank UHomeLoan Fixed
1.75%
2.31% p.a.
$0
$0 p.a.
80%
$537
Limited time offer.
Fix your mortgage for 1 year with a very competitive rate and no ongoing fees. Apply by 30 June 2021 and settle within 90 days to get this low rate.
St.George Fixed Rate Advantage Package
1.94%
3.40% p.a.
$0
$395 p.a.
80%
$551.07
Up to $4,000 refinance cashback
Borrowers with 20% deposits or equity can get this competitive fixed rate loan. Refinancers borrowing $250,000 or more can get up to $4,000 cashback (Other terms, conditions and exclusions apply).
Athena Variable Home  Loan
1.99%
1.99% p.a.
$0
$0 p.a.
60%
$554.81
Owner occupiers with 40% deposits or equity can get this competitive variable rate loan. No upfront or ongoing fees.
HSBC Fixed Rate Home Loan Package
1.88%
2.86% p.a.
$0
$390 p.a.
80%
$546.6
$3,288 refinance cashback offer
Lock in a low fixed rate for 2 years and buy your home with a 20% deposit. Eligible refinancers borrowing $250,000 or more can get a $3,288 cashback. Terms and conditions apply.
Suncorp Home Package Plus Fixed
1.89%
2.85% p.a.
$0
$0 p.a.
80%
$547.35
Lock in a low fixed rate for 2 years. Available with a 20% deposit. Eligible new borrowers can get the annual package fee reimbursed for the life of the loan.
Australian Unity Health, Wealth and Happiness Package Fixed Home Loan
1.89%
2.77% p.a.
$0
$399 p.a.
70%
$547.35
Up to $2,000 cashback.
With a 30% deposit or equity, get access to an 0.10% rate cut and big discounts on credit cards and health insurance. You may qualify for up to $2,000 cashback (Terms, conditions and exclusions apply).
Westpac Flexi First Option Home Loan
2.29%
2.72% p.a.
$0
$8 monthly ($96 p.a.)
95%
$577.55
Up to $3,000 refinance cashback.
A flexible and competitive variable rate loan. Eligible borrowers refinancing $250,000 or more can get $2,000 cashback per property plus a bonus $1,000 for their first application. Other conditions apply.
loans.com.au Smart Booster Discount Variable Home Loan
1.85%
2.21% p.a.
$0
$0 p.a.
70%
$544.38
Get a low discounted variable rate loan. Requires a 30% deposit. Get your loan processed fast and settle within 30 days.
St.George Basic Home Loan
2.49%
2.51% p.a.
$0
$0 p.a.
80%
$593.01
Up to $4,000 refinance cashback
Get this low-rate variable loan with a 20% deposit and pay $0 application fee. Borrow from $150k (or $250k to be eligible for the cashback offer) (terms, conditions & exclusions apply).
HSBC Home Value Loan
2.19%
2.20% p.a.
$0
$0 p.a.
70%
$569.91
$3,288 refinance cashback offer
This competitive variable rate loan is available for borrowers with 30% deposits. Eligible refinancers borrowing $250,000 or more can get a $3,288 cashback. Terms and conditions apply.
Australian Unity Health, Wealth and Happiness Package Fixed Home Loan
1.99%
2.91% p.a.
$0
$399 p.a.
80%
$554.81
Up to $2,000 cashback.
Borrowers with min. 20% deposits or equity are eligible for this ultra-low rate loan, packed with features. You may qualify for up to $2,000 cashback (Terms, conditions and exclusions apply).
Well Home Loans Balanced Fixed Home Loan
1.89%
2.18% p.a.
$250
$0 p.a.
90%
$547.35
Owner occupiers can get a sharp fixed rate for the first year, plus an offset account. Available with a 10% deposit.
loans.com.au Smart Booster Discount Variable Home Loan
1.99%
2.47% p.a.
$0
$0 p.a.
80%
$554.81
Home buyers can get a very low discounted variable rate for the first year. This loan has a revert rate of 2.48%. Requires a 20% deposit. Add an offset account for an additional 0.10% on your interest rate. Get your loan processed fast and settle within 30 days.
UBank UHomeLoan Fixed
1.85%
2.24% p.a.
$0
$0 p.a.
80%
$544.38
A competitive fixed rate loan with no ongoing fees. Requires a 20% deposit.
Greater Bank Great Rate Fixed Home Loan
1.69%
3.49% p.a.
$0
$0 p.a.
110%
$532.6
Get one of the lowest rates on the market with this fixed rate mortgage. NSW, QLD and ACT residents only.
Macquarie Bank Basic Fixed Home Loan
2.09%
2.32% p.a.
$0
$0 p.a.
70%
$562.33
Get a low interest rate and a mortgage with flexible, basic features. No application or ongoing fees. Requires a 30% deposit. Refinancers can switch with a convenient digital application.
IMB Fixed Rate Home Loan
1.97%
2.81% p.a.
$449
$6 monthly ($72 p.a.)
95%
$553.31
NSW and ACT customers only. 3 years fixed interest terms and free access to redraw facility online. Available with a 10% deposit.
Virgin Money Reward Me Fixed Rate Home Loan
1.98%
2.66% p.a.
$300
$10 monthly ($120 p.a.)
80%
$554.06
$3,000 refinance cashback.
Buy your home and lock in a low rate for the first two years. Get a $3,000 cashback when you switch to Virgin Money with a loan amount of $300,000 or more with an LVR up to 80%. You must apply by 29 August 2021 and settle by 26 November 2021.
Well Home Loans Balanced Variable
2.17%
2.20% p.a.
$250
$0 p.a.
80%
$568.39
A very low interest rate for home buyers with 20% deposits saved. Add an offset account for a small fee.
Bank of Melbourne Advantage Package Fixed Home Loan
1.94%
3.40% p.a.
$0
$395 p.a.
80%
$551.07
Up to $4,000 refinance cashback
Get a competitive home loan rate for two years. Requires at least a 20% deposit. Refinancers borrowing $250,000 or more can get up to $4,000 cashback (Other terms, conditions and exclusions apply).
loans.com.au Fixed
1.99%
2.70% p.a.
$0
$0 p.a.
80%
$554.81
Home buyers can lock in this low fixed rate for three years. This loan also allows extra repayments. Requires a 20% deposit.
Athena Variable Home  Loan
2.09%
2.02% p.a.
$0
$0 p.a.
70%
$562.33
A low variable rate for owner occupiers with 30% deposits. No upfront or ongoing fees.
UBank UHomeLoan Variable Rate
2.34%
2.34% p.a.
$0
$0 p.a.
80%
$581.39
Enjoy flexible repayments, a redraw facility and the ability to split your loan. Plus, pay no application or ongoing fees.
Great Southern Bank Fixed Rate Home Loan
2.09%
4.07% p.a.
$600
$0 p.a.
95%
$562.33
Pay no ongoing fees on a fixed rate home loan with flexible repayment options.
Macquarie Bank Basic Home Loan
2.34%
2.34% p.a.
$0
$0 p.a.
60%
$581.39
Apply for the Macquarie Bank Basic Home Loan - LVR ≤ 60% (Owner Occupier, P&I) and get a low variable interest rate, plus no application and ongoing fees. Requires a 40% deposit.
ME Flexible Home Loan Fixed with Members Package
1.99%
3.33% p.a.
$0
$395 p.a.
80%
$554.81
Lock in a competitive rate for owner occupiers for two years. Comes with a 100% offset account.
Suncorp Back to Basics Home Loan
2.44%
2.45% p.a.
$0
$0 p.a.
80%
$589.12
A competitive variable interest rate loan with low fees. The establishment fee is waived if you borrow $150,000 or more.
homeloans.com.au Low Rate Home Loan with Offset
2.14%
2.16% p.a.
$0
$0 p.a.
60%
$566.11
A competitive rate with no application or ongoing fees. This loan is not available for construction.
Bank of Melbourne Basic Home Loan
2.49%
2.51% p.a.
$0
$0 p.a.
80%
$593.01
Up to $4,000 refinance cashback
A competitive variable rate loan. Refinancers borrowing $250,000 or more can get up to $4,000 cashback (Other terms, conditions and exclusions apply).
Well Home Loans Balanced Fixed Home Loan
1.95%
2.17% p.a.
$250
$0 p.a.
90%
$551.82
A low fixed mortgage with an optional 100% offset account. Not available for construction purposes.
Great Southern Bank Basic Variable
2.49%
2.54% p.a.
$600
$0 p.a.
80%
$593.01
homeloans.com.au Low Rate Home Loan with Offset
2.24%
2.26% p.a.
$0
$0 p.a.
90%
$573.72
This loan offers a competitive variable rate and a 100% offset account to help save you on interest repayments. This loan is not available for construction.
BankSA Basic Home Loan
2.49%
2.51% p.a.
$0
$0 p.a.
80%
$593.01
Up to $4,000 refinance cashback
A competitive variable rate loan from BankSA. Refinancers borrowing $200,000 or more can get up to $4,000 cashback (Other terms, conditions and exclusions apply).
BankSA Advantage Package Fixed Home Loan
1.99%
3.44% p.a.
$0
$395 p.a.
80%
$554.81
Up to $4,000 refinance cashback.
Fix to a low rate for two years and forget about rate rises. Refinancers borrowing $200,000 or more can get up to $4,000 cashback (Other terms, conditions and exclusions apply).
Heritage Bank Fixed Rate Home Loan
2.19%
4.23% p.a.
$600
$8 monthly ($96 p.a.)
95%
$569.91
Get a fixed rate for two years and borrow up to 95%.
Newcastle Permanent Building Society  Premium Plus Package Fixed Rate
2.19%
3.83% p.a.
$0
$395 p.a.
95%
$569.91
$2,000 refinance cashback
Enjoy a competitive rate with no application fee for this package loan. $2,000 cashback for eligible refinancers borrowing $250,000 or more.
ME Flexible Home Loan Fixed with Members Package
2.09%
3.27% p.a.
$0
$395 p.a.
80%
$562.33
Get a low 3 year fixed rate with a 100% offset account and package discounts.
IMB Budget Home Loan
2.58%
2.64% p.a.
$449
$0 p.a.
80%
$600.05
A competitive variable rate for borrowers with 20% deposits saved. Available for NSW and ACT borrowers only.
Well Home Loans Balanced Fixed Home Loan
2.29%
2.29% p.a.
$250
$0 p.a.
90%
$577.55
A competitive 3 year investor rate with principal and interest repayments. Optional offset account with a $10 monthly fee. Not available for construction purposes.
homeloans.com.au Low Rate Home Loan with Offset
2.69%
2.52% p.a.
$0
$0 p.a.
80%
$608.71
A competitive rate with no application or ongoing fee. This loan is not available for construction.
ME Basic Home Loan
2.58%
2.60% p.a.
$0
$0 p.a.
80%
$600.05
This variable rate loan keeps the features simple and fees low. This loan is offered by a 100% online lender.
UBank UHomeLoan Fixed
2.14%
2.35% p.a.
$0
$0 p.a.
80%
$566.11
A one year fixed rate offer with no ongoing bank fees.
Heritage Bank Discount Variable Home Loan
2.59%
2.64% p.a.
$600
$0 p.a.
80%
$600.83
Family guarantee option available. Enjoy flexible repayments and a low minimum loan amount.
UBank UHomeLoan Fixed
1.99%
2.70% p.a.
$0
$0 p.a.
80%
$554.81
Limited time offer.
Investors can enjoy flexible repayments and an easy application process with this pioneering online lender. Apply by 30 June 2021 and settle within 90 days to get this low rate.
ME Flexible Home Loan Fixed
2.64%
4.65% p.a.
$0
$0 p.a.
80%
$604.76
Lock in a competitive rate for 2 years, unlock package discounts and use a 100% offset account to minimise interest payments.
Heritage Bank Advantage Package Fixed
2.39%
3.15% p.a.
$0
$350 p.a.
95%
$585.25
Get a partial offset account and flexible repayments with this package loan.
homeloans.com.au Low Rate Home Loan with Offset
2.59%
2.42% p.a.
$0
$0 p.a.
60%
$600.83
This competitive variable rate loan is for investors who want interest-only repayments. You will need a 40% deposit.
Macquarie Bank Offset Home Loan Package
2.34%
2.62% p.a.
$0
$0 p.a.
60%
$581.39
A sharp variable rate with low fees for borrowers with 40% deposits or refinancers with equity in their properties. Refinancers can switch with a convenient digital application.
loans.com.au Smart Booster Discount Investor Variable Home Loan
1.99%
2.71% p.a.
$0
$0 p.a.
80%
$554.81
If you have an owner occupier loan with loans.com.au you can also get this very low rate variable mortgage for your investment property. Principal and interest repayments. Add an offset account for an additional 0.10% on your interest rate. Get your loan processed fast and settle within 30 days.
homeloans.com.au Low Rate Home Loan with Offset
2.74%
2.76% p.a.
$0
$0 p.a.
90%
$612.67
Access a fee-free offset account and a special interest rate for investors. This loan is not available for construction.
St.George Basic Home Loan
2.54%
2.56% p.a.
$0
$0 p.a.
90%
$596.91
$2,000 cashback.
With this competitive variable rate loan from St.George, refinancers borrowing $250,000+ can get a $2,000 cashback (terms, conditions & exclusions apply)
Macquarie Bank Basic Fixed Home Loan
2.19%
2.42% p.a.
$0
$0 p.a.
80%
$569.91
Borrow up to $750,000 with this basic 3 years fixed rate home loan. Refinancers can switch with a convenient digital application.
Bank of Melbourne Basic Home Loan
2.54%
2.56% p.a.
$0
$0 p.a.
90%
$596.91
$2,000 cashback
A competitive variable rate loan. Refinancers borrowing $250,000 or more can get a $2,000 cashback (Other terms, conditions and exclusions apply).
homeloans.com.au Low Rate Home Loan with Offset
2.39%
2.41% p.a.
$0
$0 p.a.
80%
$585.25
This investment loan keeps fees low, has a sharp interest rate and comes with a 100% offset account. This loan is not available for construction.
IMB Budget Home Loan
2.68%
2.74% p.a.
$449
$0 p.a.
95%
$607.92
NSW and ACT customers only. You can get an interest rate discount for a limited time with this competitive variable mortgage.
Newcastle Permanent Building Society Real Deal Home Loan
2.59%
2.63% p.a.
$595
$0 p.a.
80%
$600.83
$2,000 refinance cashback
$2,000 cashback for eligible refinancers borrowing $250,000 or more.
UBank UHomeLoan Variable Rate
2.74%
2.74% p.a.
$0
$0 p.a.
80%
$612.67
Get a discounted, low-fee investor loan from a convenient online lender. 20% deposit required.
Virgin Money Reward Me Variable Home Loan
2.59%
2.76% p.a.
$300
$10 monthly ($120 p.a.)
60%
$600.83
$3,000 refinance cashback.
A variable rate loan for owner occupiers with a 40% deposit (or equity) borrowing under $500,000. Get a $3,000 cashback when you switch to Virgin Money with a loan amount of $300,000 or more with an LVR up to 80%. You must apply by 29 August 2021 and settle by 26 November 2021.
homeloans.com.au Low Rate Home Loan with Offset
2.29%
2.31% p.a.
$0
$0 p.a.
60%
$577.55
A competitive rate with no application or ongoing fee. This loan is not available for construction.
ME Flexible Home Loan Fixed
2.14%
3.95% p.a.
$0
$0 p.a.
80%
$566.11
Get a low fixed rate and pay no application or ongoing fees.
IMB Fixed Rate Home Loan
1.89%
2.87% p.a.
$449
$6 monthly ($72 p.a.)
95%
$547.35
NSW and ACT customers only. Lock in a low fixed rate for two years. Available with a 5% deposit.
Newcastle Permanent Building Society  Premium Plus Package Fixed Rate
2.19%
3.72% p.a.
$0
$395 p.a.
95%
$569.91
$2,000 refinance cashback
Enjoy a discounted fixed rate and the ability to package the loan with other financial products. $2,000 cashback for eligible refinancers borrowing $250,000 or more.
homeloans.com.au Low Rate Home Loan with Offset
2.59%
2.61% p.a.
$0
$0 p.a.
90%
$600.83
Save on interest with a free 100% offset account and buy your property with just a 10% deposit. This loan is not available for construction.
IMB Fixed Rate Home Loan
2.35%
3.33% p.a.
$449
$6 monthly ($72 p.a.)
90%
$582.16
NSW and ACT customers only. A 3 years fixed rate investor which allows extra repayments to be made.
ME Flexible Home Loan With Member Package
2.59%
3.05% p.a.
$0
$395 p.a.
80%
$600.83
$2,000 cashback offer
A competitive variable rate package home loan with a 100% offset account. Eligible refinancers can get a $2,000 cashback.
UBank UHomeLoan Fixed
2.09%
2.71% p.a.
$0
$0 p.a.
80%
$562.33
Limited time offer.
Investors can enjoy flexible repayments and an easy application process with this pioneering online lender. Apply by 30 June 2021 and settle within 90 days to get this low rate.
HSBC Home Value Loan
2.54%
2.55% p.a.
$0
$0 p.a.
90%
$596.91