New research has found Millennials and Generation-Z hold the majority of the first home buyer market, despite rising property prices.
New InfoTrack research found 38.4 per cent of first home buyers New South Wales from the last two months were millennials or Gen-Z, aged between 18 to 29 years old. A further 41.5 per cent were millennials aged between 30 and 39.
Millennials, or Generation Y, are aged between 26 to 41 (born between 1980 to 1995), while Gen-Z were born in 1996 to 2012, meaning they’re aged between nine to 25 years of age.
That means these two generations account for 79.9 per cent of the total first home buyer market, with 40 to 49 year olds holding just 14.32 per cent. First home buyers aged 41 and over accounted for just under 6 per cent of the market.
Sydney’s dwelling values jumped 20.9 per cent in the year to August, while in regional New South Wales values increased by 24.8 per cent over the same period, according to CoreLogic.
Nationally, Australian housing values are 18.4 per cent higher than this time last year – the fastest pace of growth in more than 30 years.
John Ahern, CEO of InfoTrack, said while rising prices might have spooked some first home buyers, it was encouraging to discover one-third of those who have bought were Gen-Z or the younger end of Gen-Y.
“It’s promising that our data shows young buyers are determined to get into the property market, whatever the hurdles. It just goes to show that the Great Australian Dream of homeownership can be achieved in your 20s,” he said.
“It paints a good picture for these switched-on young buyers. Despite the overall property boom often spelling doom and gloom for first home buyers, it’s encouraging to see the drive still there for our youngest home-owners,” he added.
Mr Ahern explained that the pandemic and current state of the economy actually presented a perfect property storm for first home buyers that otherwise might not have arisen.
“This low interest rate climate – combined with the fact that young Australians have had limited options to spend their extra cash during 18 months of on again off again lockdowns and travel restrictions – has led many to consider that property is the best place to put those savings,” he said.
InfoTrack also revealed where first home buyers were purchasing in the state, with their focus firmly on the outer ring of Greater Sydney, where detached housing was considered more affordable.
According to the latest data, 63 per cent of recent first home buyers have purchased a Torrens title home.
Top 10 most popular suburbs among first home buyers (July to August, 2021)
|Suburb||Median house price||Distance from CBD (km)|
“It’s been the case for some time, but we’re still seeing Austral and Marsden Park in Western Sydney as the two most popular suburbs for first home buyers,” Mr Ahern said.
With a median house price of $745,000, Austral offers first home buyers a lower entry point compared with other suburbs, especially those closer to the Parramatta or Sydney CBDs.
“Austral has plenty of potential as it’s going to be in close proximity of Sydney’s second airport, which is being built virtually next door. It also has plenty of land, so building a decent sized house is a realistic option for young buyers hoping to purchase a long-term family home,” he said.
In Marsden Park, buyers could expect to pay a little more, but the amenities were well established, the data showed.
“The average sale price in Marsden Park is around $875,000 and it ticks a lot of boxes for first home buyers. There is a lot of green space, views of the Blue Mountains, and access to infrastructure such as the railway station,” Mr Ahern said.
Also climbing the popularity stakes among first home buyers in recent months is Kingswood in the Penrith LGA.
“The neighbourhood of Kingswood has seen a huge jump in demand over the past couple of months. It was sitting in equal 20th position when we last collated the data back in June, but now it sits at fourth place. Considering it has both the Nepean Hospital and a University of Western Sydney campus within its borders, it has a lot to offer also,” he said.
InfoTrack’s research also unveiled that Greystanes, which previously ranked ninth, was now sixth on the list and regional areas such as Dubbo and Wagga Wagga had fallen out of the top 10 over the last two months.