First Australia- next NZ. While interest rates are low, and prices stable, if you don’t buy now you may be locked out for ever.
Paying rent for a life time is a hiding to no where.
Never mind if the house is not up to your standard. Too many people want to start where their parents left off. So rough it a while, improve, save and you will be surprised how the next steps are that much easier.
Home ownership an elusive dream for ‘generation rent’
Last updated 10:54 11/06/2011
They’re being dubbed ”generation rent” – twenty and thirty-somethings who are resigned to never owning a home.
In Australia, the number of first-time buyers taking out home loans is at the lowest level since 1994, as many taking a more conservative approach to their borrowing.
Home ownership is particularly hard in NSW, which has been the least affordable state or territory in which to own a home for the past 15 years, according to the REIA Deposit Power Housing Affordability Report.
The average proportion of income required to meet home loan repayments here is 34.5 per cent – 3 per cent higher than the national average.
”That is an enormous amount of people’s income,” said David Airey, the president of the Real Estate Institute of Australia.
”First-home buyers have been on the decline since 2009, after the government’s first home-buyers’ boost ended, and high interest rates combined with high house prices are other contributing factors.”
Even those with qualifications and steady jobs were not counting on earning enough to buy a home.
Tom Cawsey will finish his degree in biomedical science this year, but said he didn’t expect a full-time job in his field to lead to home ownership.
”My goal is to be able to afford a better rental property, not to buy my first home,” said the 24-year-old, who rents in Sydney with two friends for A$690 per week.
”Some young people are waiting to inherit their parents’ homes, but it’s not an option for everyone.”
This attitude is being replicated elsewhere. A report from Britain’s Independent newspaper said an online survey of 8000 Britons aged 20 to 45 found more than three-quarters who did not own property would like to, but 64 per cent believed that their prospects of buying their own home were nil. Like in Europe, living in rented property for life is becoming the norm there.
Lyndon Chan, a surgical registrar, said he could afford to buy in Sydney but did not think it was worth it.
”None of my friends who are doctors around my level in Sydney are even thinking about buying here, at least until they become consultants,” the 30-year-old said.
”But I also think it is a generational thing. My parents scrimped and saved to buy their home and we rarely did things like go out to dinner. I by no means live extravagantly, but maybe this generation doesn’t want to work hard only to sacrifice their lifestyle just to be able to buy a home.”
Daniel Benhar is 28 years old, and has been in full-time work for five years. ”I’ve realised that I’m on an above-average income, yet I can’t afford an average home,” he said. An animator and designer, he lives with his girlfriend, Tara McAvoy, 26, in Sydney’s Newtown with one other person, between them paying A$550 per week.
”I wouldn’t feel comfortable buying unless I had saved up at least 30 per cent of the cost of the home,” he said.
- Sydney Morning Herald