Property crisis: Will young Australians be able to get a foot in the door?
Home ownership already seemed like a far-off dream for many young Australians. But since the coronavirus pandemic sent the economy into a tailspin, that dream has been pushed even further back. Mozo research found that 52% of millennials have seen their wages reduced by 20% or more as a result of the crisis. For those hoping to buy a home in Sydney, that means they’ll have to save an extra 14 months for a deposit, or 7.4 years in total. First home buyers in Melbourne have also had their savings journey extended. There, a 20% reduction in earnings translates to an extra 12 months of saving, bringing the total amount of time needed to six years. “Covid-19 has disrupted incomes across multiple industries throughout the country, and in doing so it has also slowed down the great Australian dream of home ownership,” said Mozo Director Kirsty Lamont. “With so many millennials having their income reduced, putting 20% of your income into savings will no longer be an option for some first home buyers, who need to prioritise their immediate expenses.” Across the nation’s capital cities, first home buyers in Perth and Darwin have emerged as the least disadvantaged, only needing to save for an extra six months if they have experienced wage reductions. Entry level homes in the two cities are relatively cheap when compared to the average income, making home ownership a more attainable goal than in other capital cities.
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