New research from Westpac shows that COVID-19 is continuing to shape Australian home ownership goals, with the number of first home buyers looking to enter the property market in the next five years doubling from 7 per cent before the pandemic to 16 per cent.
New research from Westpac shows that COVID-19 is continuing to shape Australian home ownership goals, with the number of first home buyers looking to enter the property market in the next five years doubling from 7 per cent before the pandemic to 16 per cent [1].
No longer wanting to pay rent (54%) is the major driver for purchasing a first home, followed by seeking more stability (39%) and financial security (37%) after the uncertainty brought about by COVID-19.
Nearly half (48%) of first home buyers said they were more optimistic about entering the housing market than they were 12 months ago, due to factors like house prices (38%), low interest rates (24%) and the opportunity to live in a new area (24%).
Beyond financial reasons, the findings suggest time spent with others during restrictions has also been a motivating factor, with seven in ten (69%) of those currently sharing a roof with housemates, parents or in-laws now determined to get a foot on the ladder. A third (32%) of prospective buyers are also seeking a sense of independence through home ownership.
Westpac’s Managing Director of Mortgages, Anthony Hughes, said the research shows young Australians are increasingly seeking the sense of independence and stability that home ownership provides.
“It’s encouraging that so many Australians are thinking about home ownership despite some of the challenges brought about by the pandemic.
“It’s also interesting to see this is now largely being driven by Gen Z, who after being cooped up at home during restrictions are now ready to leave their housemates or parents behind for a place of their own – many of whom might not have considered this a possibility prior to COVID-19.
“Even though younger generations have been some of the most financially impacted this year, it’s positive that many have really used this time to take stock of their finances and get serious about their long-term goals.”
The research also found that almost half (48%) of Australians believe that COVID-19 has made them re-consider the type of suburb or area they would like to live in. This number increased to 59 per cent for younger age groups [2].
The top locations first home buyers identified they would like to buy in are:
“While we’re seeing an increasing interest in properties that offer more space, there’s still a strong desire from first home buyers to live somewhere that’s still only about 20-30 minutes away from the CBD,” Mr Hughes said.
“With a younger generation of buyers emerging, many are also weighing up areas that would enable them to maintain a certain lifestyle, like Sydney’s Inner West which is in close proximity to social hubs and nightlife, while also catering to changing needs like the ability to work from home more.”
[1] In 2020, 16% of Australians were planning to buy a first home in the next five years, increasing from 7% in 2019.
[2] 59% of Gen Z said COVID-19 has made them reconsider where they’d like to live, compared to 48% nationally.
The views expressed in this article are an opinion only and readers should rely on their independent advice in relation to such matters.
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