The number of single homebuyers has declined considerably over the past two years

According to new data from ME Bank and ING DIRECT, the number of single homebuyers has declined significantly over the past two years. Indeed, experts warn that prospective homebuyers who aren’t in a relationship will soon find the property market “out of reach.”

An analysis of 40,000 home loan applications by Melbourne-based ME Bank found a drop of nearly 10% in home loan applications from single applicants in the two years to 2016.

As for those who could take on a mortgage without the benefit of a partner, their loans have grown substantially. The average loan size for single-mortgage applications rose by 9% in two years to $355,000.

As noted by Domain Group’s Jennifer Duke, single applicants in New South Wales faced loans 16% larger at an average of $422,000, while in Victoria, single applicants were borrowing an average of $348,000, up 11% in 24 months.

Data from ING DIRECT reveals a similar trend. The number of single applicants for home loans dropped from 32% in 2009 to just 25% in 2016.

According to Patrick Nolan, head of home loans at ME Bank, housing affordability is a tough hurdle for many prospective homebuyers to overcome. “Even as part of a couple, east coast property prices are out of reach for many Australians,” he said.

Paul Bevan, mortgage broker at Brisbane-based Dream Financial Services, said most of his clients were in relationships, with just a quarter buying as singles either as investors or owner-occupiers.

“Buying property as a single is becoming increasingly difficult,” he told the Domain Group. “The biggest issue for singles is serviceability. With only one income, borrowing capacity is typically less than [couples] with dual incomes.

“Quite often, singles are competing against dual-income couples when looking to buy and are unable to match their buying power – they are simply priced out of the market.”

Bevan recommends looking for properties with less competition from buyers, such as one-bedroom apartments. Single home loan applicants should also maximise their borrowing capacity by paying off and closing credit cards, reducing expenses, and considering a second job.