OREANDA-NEWS. First-home buyers are finding it more difficult to secure a dwelling in Auckland as income growth lags house-price gains, a trend that Fitch Ratings believes will cause this group of purchasers to constitute a smaller part of the housing market.

Average house prices in Auckland had increased nominally by 72% in the four years to June 2016, making it difficult for first-home buyers to come up with enough funds to pay a deposit.

In June 2016, a typical deposit of 10% for an average dwelling in the Auckland region was equivalent to 1.68x the average annual earnings of a single borrower (June 2012: 1.05x); that is much higher than the national average (1.10x).

Affordability is stronger in the region of Wellington, where the deposit-to-income ratio was 0.87x as of June 2016, and has been stable averaging 0.83x in the past 12 years.