Reasons Why It’s Hard to Buy Your First Home in Australia
It’s everyone’s dream to find that perfect home for them. For newlyweds, owning their first home is a top priority – a place where two people can start a whole new chapter of their lives together. But it looks like this dream is going to be a little bit more difficult to achieve right now.
There have been talks about how difficult it is for first-time homeowners to buy their house. Latest reports say that a drop from 71.4% to 67.5% of homeowners were seen in the last 20 years. However, household renting experienced an increase. In other reports, 86.2% of Australians find it difficult to purchase their house even if there are price declines. So, what could be the main reasons for this occurrence? What do these things have to do with the difficulty in purchasing your own home? Let’s find out.
Here are some of the things that are really hurting the property market condition as told by Australians:
Affordability pressures are seen to be a huge contribution why many first-time homebuyers find it extremely difficult to purchase a house. Prospective buyers still choose to purchase smaller property despite the fact that there are price declines because bigger spaces would always often mean to be unaffordable to many. Furthermore, many find it also challenging to save sufficient deposit for the property they are eyeing which could be another reason for this.
Delayed Entry to Ownership
Another reason is generational change, wherein young homeowners are decreasing significantly because people are starting to invest a little bit later in life. For instance, in 1982 the percentage of owners aged 25-34 was 56%. In 2011, only 34% was recorded for this age group. There are also studies indicating that distribution in housing inefficiently is one of the problems and not the supply. This leads to a lot of homeless people or those that are really struggling to pay for their houses.
Changes in Priorities
Recent studies have stated that millennials are much more interested in investing in life experiences and having the “YOLO” or “You Only Live Once” kind of lifestyle. Rather than buying property, more young people choose to live in the moment and enjoy trying different kinds of foods and other experiences, possibly including, traveling. Another thing is that most properties that the younger generation prefer to value proximity. Most of them are not willing to sacrifice better transportation for owning a place that are too far or out of reach.
Because of the planning controls that affect the development of houses in a higher density, especially in the middle suburbs. Apart from the supply factor, this is seen to be a huge contributor as well as the charges and fees of developers regarding construction. There are also problems in terms of mortgage debts being relatively higher than average household incomes. This is seen to happen in all age groups.
These are just some of the reasons experts see that make it harder for first-time buyers to own their first home, but surely there are more and it’s important that the government find ways to make it easier for many especially now.