House prices keeping young adults at home
Moving out of your parents’ place is a rite of passage that comes as you come of age. But when times are tough, it’s understandable that one may delay such a move.
According to the 2016 Census, 20% more 25 – 34 year olds are still living with their parents compared to 5 years ago. Many move out then move back multiple times — the so-called Boomerang Kids — creating something of a baby boomer “headquarters” home, often housing multiple generations.
The steep rise in the number of non-dependents shacking up with their folks comes down to Sydney’s housing boom, making it harder for young people save a deposit to purchase their first home.
If you were looking to put down a 10% deposit on a first home loan back in 2011, you’d only need to save $63,725. Five years later borrowers would have to cough up $78,000, that’s $14,247 more.
There is light at the end of the tunnel with new and improved first home owner grants and concessions including the abolition of stamp duty for eligible applicants and the first home super saver scheme are set to kick in on July 1, which could help to turn the stay in the nest trend around. On top of that, CoreLogic data reveals a slight dip in the Sydney property market.
Scott Durrant from Successful Ways says that while these incentives may improve housing affordability in the short term, young Australians with deposits saved up should act sooner rather than later before a flood of buyers enter the market and push prices up even further.
The 2016 Census data also revealed that home ownership rates are dropping. 25 years ago, 41% of households owned their homes outright, while in 2016 only 31% of households did.
If you’re a baby boomer desperate to become an empty nester, perhaps some education can push your children in the right direction.
Our adult education courses are designed to guide people through the stressful process of buying their first home and help build more wealth for their future.
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