40% Of FHBs To Rely On Family Support
Research conducted by AHURI has found that a large number of young homeowner hopefuls are expected to rely on the bank of mum and dad.
The research entitled, Pathways to home ownership in an age of uncertainty, was undertaken by The Australian Housing and Urban Research Institute (AHURI) researchers from the University of Sydney and Curtin University and examined how householders aged 25–35 in Sydney and Perth are adapting their living arrangements and spending and saving behaviours in order to purchase a home.
One of the key findings from the research was that 40 per cent of the 850 young adults surveyed said they expected financial support from their family in some form to go towards buying a new home in the future.
The research drew the conclusion that it is no longer possible for many people in the age bracket to independently save up for a deposit to enter the property market, with 74 per cent of young adult renters having reported that they had less than $5,000 in savings.
Furthermore, AHURI suggested that rising house prices and cost-of-living pressures have made the task of buying a home worse. Households with even moderate incomes are unable to keep up with market increases through typical saving and budgeting strategies.
Lead author of the research, Dr Laurence Troy of the University of Sydney, said in addition to the survey, they provided financial diaries to 20 households in order to examine the complexities of saving and spending habits.
“The diaries confirmed that young adults are actively using strategies to support saving, such as minimising discretionary spending and paying ahead on utility bills,” Dr Troy stated.
“Instead, the young adults are focussed on paying reoccurring items such as food, petrol and debts, with the biggest challenges being the large irregular, and often unexpected, expenditures such as car repairs and professional insurances.”
Notably, this research seemingly contradicts Domain’s latest First Home Buyer Report that found that the time it would take for a couple to save for a 20 per cent deposit on a house has fallen to under five years on average.
Specifically, the report stated it took an average of four years and 11 months for a couple to save for a deposit on an entry-price house in February 2023.
This revealed a drop of six months on February 2022, when it took an average of five years and five months.
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