The changing path to home ownership for young Australians
Home ownership among Australians aged 25–34 has fallen to levels last seen in the 1940s, highlighting how much harder it has become for younger Australians to enter the property market. But newer finance pathways can help address some of the barriers.
Anglicare Australia’s ‘Falling Behind’ report found fewer than 40% of 25–34-year-olds owned a home in 2021. Ownership among 35–44-year-olds has also fallen from around 75% in the late 1980s to below 60%.
The report points to rising property prices, essential living costs and stagnant wage growth as barriers to saving a deposit or servicing a mortgage.
Today’s first home buyers have several pathways that can address specific financing hurdles. The federal government’s 5% Deposit Scheme can reduce the deposit required and help buyers avoid lender’s mortgage insurance, while Help to Buy can reduce the amount eligible buyers need to borrow through shared equity. Changes to how some lenders assess HECS debt may also improve borrowing capacity.
While these options won’t solve housing affordability, they could help more buyers overcome individual barriers to home ownership and enter the Sydney property market.
About the author – Alex Veljancevski is a Sydney Mortgage Broker with Eventus Financial, which assists first home buyers, investors, upgraders and borrowers seeking to refinance to a better deal on their home loan.