How can we help young people who aspire to own their own home?

What is the Problem?

Although home ownership has been declining in Australia for some years now, this decline has been particularly concentrated among young adults. Home ownership rates for under-35s fell from around 60 per cent in the 1980s to 45 per cent in 2016. This means that young adults are either renting or living with their parents for much longer.

When comparing themselves to the generation of their parents, our younger generations are finding that they simply do not have the same opportunities to purchase their first home and accumulate housing wealth.

Not only is home ownership declining for the young, but for those who do manage to attain home ownership status, they do so by committing to greater levels of borrowing and diverting greater shares of household budgets to meet mortgage loan repayments. Mortgage indebtedness is at record high levels for younger age groups based on historical trends.

This is all amidst increasing earnings inequality and increasing job insecurity for the younger generations, which has led to growing precariousness for home owners. From 2000-2010, 1.9 million episodes of home ownership were terminated. How can we help young and aspiring home-owners to afford their first home?

Key Facts

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