Higher property prices mean living in Sydney carries a significant cost compared to other capitals.

The analysis from CoreLogic also revealed Sydney buyers require nearly $66,000 more in savings to get onto the bottom rungs of the property ladder than Melbourne buyers.

The findings factored in the requirements for a 20 per cent deposit on houses priced within the bottom 25 per cent of home sales, along with stamp duty, in each of Australia’s capital cities.

Banks generally require a deposit of 20 per cent of a home’s purchase price for buyers to avoid paying lenders mortgage insurance.

With Sydney’s cheapest houses typically priced around the mark of $660,000, even buyers who use small deposits still require hefty deposits, according to CoreLogic analyst Cameron Kusher.

Even homes at the cheaper end of the Sydney housing market require large deposit. This home at 26 Sixth Ave Katoomba is for sale at $725,000.Source:Supplied

A 5 per cent deposit coupled with stamp duty costs, for example, requires $59,033 in savings.

Stamp duty and a 5 per cent deposit on Canberra’s cheapest houses, meanwhile, typically require $41,357 in upfront savings, while in Adelaide that number was $32,921.

“Deposits required for a house in all other capital cities … is less than half of the deposit required in Sydney,” Mr Kusher said.

Mr Kusher said another challenge for potential first homebuyers in Sydney was that growth in household incomes was not matching increases in property prices.

Sydney dwelling values increased by 16 per cent over the year to April, but household income increased by roughly 4.6 per cent over a similar time frame.

“Entry into the housing market remains a real challenge,” Mr Kusher said. “Even in cheaper areas, household income growth is fairly slow, which makes saving a deposit difficult.”

Originally published as Buying Sydney home requires $159k in savings