Houses no longer the ‘Great Australian Dream’ as home buyers change strategy to get into the market

The property market has become so expensive that nine out of 10 Australians are despairing about their prospects of achieving the ‘Great Australian Dream’, new data shows.

A white paper from Mortgage Choice in conjunction with research firm Core Data, The Evolving Great Australian Dream, surveyed 1000 Australians to find out whether attitudes towards home ownership were shifting.

Some [first-home buyers] are accepting that they may have to rent for their entire life…Taj Singh, FHBA

Of those surveyed, 67.3 per cent said the market was “too hot” due to rising prices, Mortgage Choice chief executive John Flavell said. And 87 per cent said it was too difficult to achieve the traditional home ownership dream of a freestanding house.

“Over the last few years, we have seen a dramatic surge in the number of people embracing apartment living. And, when you look at the level of apartment construction taking place across the country, it is likely that we will continue to see more Australians calling apartments ‘home’,” Mr Flavell said.

“We need to find a way to either cool the market down, or help Australians who are struggling to get their foot on the property ladder achieve their dream of home ownership.”

Taj Singh, co-founder of lobby group First Home Buyers Australia, said the appetite from first-home buyers for a house had changed over the last year.

“Some are accepting that they may have to rent for their entire life and pay [the landlord’s] mortgage who is subsidised by the government through generous tax incentives, or they may have to move interstate or to the country to realise their Great Australian Dream of home ownership,” Mr Singh said.

“In terms of capacity to save a deposit, it has never been worse in NSW, which is another reason why we are seeing a shift towards many first-home buyers becoming long-term renters in high-rise buildings.”

He said some would consider an apartment rather than house, buying further away from the city, asking for parent assistance and teaming up with friends.

The Westpac 2016 Home Ownership Report survey found 86 per cent still wanted to own real estate, with most desiring home ownership due to stability, financial security and a sense of achievement.

Alternative approaches to achieve property ownership were becoming more common for first-home buyers, Chris Screen, head of home ownership for Westpac Group, said.

“Affordability is a key concern for many Australians looking to get into the property market,” Mr Screen said, with 32 per cent pointing to home loan affordability issues and 29 per cent finding it difficult to save a deposit. 

The dream of a quarter-acre suburban detached house also came under attack last year, with former Planning Minister Rob Stokes describing the idea as “unjust” due to the scarcity of land in Sydney.

“In 1975 … Sydney was a homogenous sprawl of terracotta roofs. To buy a house it cost four times the average salary – today, the same home costs at least 12 times the average salary,” Mr Stokes said at an Urban Development Institute of Australia NSW event.

“As Sydney moves away from the traditional red brick home with a backyard in the suburbs, Australians need a diversity of housing choice other than just an apartment or a house.”

He pointed to the “missing middle” of terraces, townhouses and duplexes as a valid alternative that has been “missing” for decades in the Sydney market.​

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By | 2017-08-17T19:16:24+00:00 March 22nd, 2017|Australia, Real Estate|Comments Off on Houses no longer the ‘Great Australian Dream’ as home buyers change strategy to get into the market