October 26, 2017

Sad reality on home ownership

Over a third of Aussies reckon they’ll never afford a house

SHOCKING new findings show up to 35 per cent of Australians have thrown in the towel when it comes to buying their own house.

House prices are still tipped to rise in most Aussie cities over the next three years.

A STAGGERING amount of Aussies have abandoned their dream of buying their own house.

New research from [finder.com.au] shows that more than one-third of us have given up — as the latest predictions show house prices are still expected to surge in Australian cities over the next three years.

The sobering findings also show that more than one in 10 of us have also given up on the dream of owning any property at all, but are comfortable with this if it means they don’t have to sacrifice their lifestyle.

The national survey of 2010 people shows almost two thirds (65 per cent) of Australians are clinging to the home ownership dream.

The survey shows Aussies are pessimistic about their chances of buying a house.

However, nearly a third (27 per cent) of these respondents will have to compromise on property size or location.

The research comes after some fairly good news for first-time buyers — with unit prices predicted to fall seven per cent for Brisbane, Melbourne five per cent and Sydney four per cent.

Bessie Hassan, a money expert at finder.com.au, says the results of the latest survey are sobering.

“Many Aussies are disenchanted with the home ownership dream, believing property is unattainable,” she said. “But the research also shows Aussies are being realistic by acknowledging that some sacrifices need to be made.

QBE predicts small house price drops over the next three years.

“Prospective homeowners could have more luck by looking at areas further out from the central business district (CBD) or by settling for a smaller property. In New South Wales, 40 per cent have given up hope of owning property as prices have become unaffordable. Ms Hassan said the results suggest ‘generation rent’ may be on the rise.

She added that high house prices and slow wage growth could be acting as barriers for those trying to get on the property ladder.

“Many are accepting the idea of long-term renting. However, not building up equity or having the security of a home could be problematic later in life,” she said.

“If you’re a young person wanting an acre of land and a swimming pool, this is not good news,” said QBE Lenders’ Mortgage Insurance CEO Phil White. “But if you’re a first-time buyer looking to get your first foot in the market, this is very promising because unit prices look like they could drop in Sydney, Melbourne and Brisbane.”

‘Generation rent’ may be on the rise.

It comes after a damning report from the Australian Institute of Health and Welfare which shows a higher percentage of people in Eastern European countries like Hungary and the Czech Republic own their own home than Australians.

The report shows home ownership for young people has fallen by more than one-third in the past 25 years.

And, Brendan Coates, a housing policy expert at the Grattan Institute, said if Aussies aren’t on the property ladder by 35 then we could be paying off our mortgages with your superannuation.

“But it’s not all doom and gloom — property is attainable for those who are willing to be disciplined with their savings,” said Ms Hassan. “It might mean you’re saving a deposit for 10 years instead of five, but if you persevere, chances are you’ll be one step closer to being a proud homeowner.”

This story first appeared on News Limited 8:49pm October 26, 2017.