As read in the Australian Broker Online – The average age of the Australian first home buyer (FHB) has remained stable for the past two decades despite reaching an annual property price growth of 7.7% per year.
A new paper from the Commonwealth Bank of Australia (CBA), CommBank Connected Future Report, found that buyers generally entered the market for the first time at 32 years old. This has remained unchanged for 20 years.
To examine the market trends from the data, CBA partnered with Claire Madden, social researcher, keynote speaker and demographer.
“It’s quite an interesting finding that the average age of a first home buyer has remained relatively consistent for the past few decades hovering at that 32 years of age mark particularly when we’re seeing other life markers such as the age of marriage and childbirth be pushed back later,” Madden told Australian Broker.
“What we are seeing is the journey for Gen Y to get to that point of home ownership has looked drastically different from their predecessors. It means that in many cases they have stayed at home longer to enable them to save up for that deposit.”
This was not to discount the obstacles that the younger generation had to overcome, she added, with increasing household expenses an example of this.
“If we go back to 1970, 13% of household expenditure was spent on housing. It had risen to 18% by 2012. For first home buyers, it was 21% of their gross weekly income.”
Rising housing prices had also changed the property landscape with the Australian ‘dream home’ transforming from a standalone weatherboard house on a quarter acre block into smaller, more architecturally designed products, the report found.
While 74% of those living in cities and 81% of those in regional areas live in a standalone home, 48% of new residential approvals over the past year have been for medium or high density housing.
“This is how people are responding to increased prices and greater demand,” Madden said. “What it does show us is that getting into the property market still resides deep in the Australian heart and is high on the aspiration list with young adults who are still in those key family forming years.”
Finally, optimism levels around real estate vary from state to state with the percentage of those who believe the property dream is still attainable listed below:
- Vic (46%)
- NSW (47%)
- ACT (47%)
- Tas (49%)
- Qld (51%)
- SA (52%)
- WA (54%)
- NT (57%)
John can be contacted on 0749722081 or 0410433919. Or email him at email@example.com or net www.ihl.net.au. John Whitten is a credit resentative (CRN 399796) of BLASSA Pty Ltd (Australian Credit Licence No 391237).