Modern Australian

First home buyer schemes aren't enough to meet young adults' housing aspirations

  • Written by Sharon Parkinson, Senior Research Fellow, Centre for Urban Transitions, Swinburne University of Technology

Young adults not only struggle to buy a home, many struggle to secure any kind of independent housing. This contributes to a cycle of living in precarious and informal housing and to a growing gap between their current situation and their short and longer-term housing aspirations.

A report released today by the Australian Housing and Urban Research Institute (AHURI) adds nuance to debates about generational change and housing by examining how housing aspirations differ among emerging adults (18-24 years) and in early adulthood (25-34 years). For example, emerging adults are more likely than the older cohort to prefer living in an apartment.

By early adulthood, the housing aspirations gap is greatest for individuals in the private rental sector, particularly those on higher incomes, and narrowest for home owners. Home buyers on low to moderate incomes are most happy with their housing.

Read more: Moving on from home ownership for 'Generation Rent'

While long-held values around the ideal of home ownership prevail, these are not as persistent as for past generations. The ideal differs according to age, education and the quality and security of current living arrangements. But having somewhere safe and secure to call home was the top priority across all young adults.

Aspirations change with stage of life

An extended phase of dependence to semi-dependence shapes the housing aspirations of young adults. This involves either remaining in the family home or sharing with others.

In 2015-16, the ABS Survey of Income and Housing revealed that only one in six (17%) young adults (18-24 years) lived independently. Two-thirds (66%) lived with parents. Around a third of young adults (25-34 years) are also opting to remain or move back with parents or live in shared housing.

Read more: Over 50% of young Australian adults still live with their parents – and the numbers are climbing faster for women

While these living arrangements reflect concerns about housing affordability, they are also used as a strategy to pursue other aspirations, such as education.

What do young adults want in their housing?

The AHURI research includes a nationally representative survey of more than 2,400 Australians aged 18-34 years. It was supported by focus groups and in-depth interviews, including with Indigenous Australians, in Western Australia, New South Wales and Victoria.

Home ownership was the ideal tenure for 60% of emerging adults (18-24). By early adulthood (25-34) the proportion had climbed to 70%. The ideal of home ownership was lower (61%) for those still living in the family home by early adulthood compared with higher-income couples living independently (80%).

By early adulthood, educational status becomes a key marker of whether home ownership is considered possible. Nearly two-thirds (61%) of households with a tertiary-educated member believed they could buy a house within five years. This compares with just over a third of those with an education to year 12 (36%) and less than a quarter (23%) of those with an education to year 11 or below.

The preference for apartment living falls with age. About a third (34%) of emerging adults reported this as their ideal, compared with 21% of early adults.

Young adults also want more space. The largest share of both emerging (32%) and early adults (43%) indicated that a four-bedroom house is ideal. This compares to just 20% of those over 55 years of age who wanted four or more bedrooms.

Read more: What sort of housing do older Australians want and where do they want to live?

How large is the housing aspirations gap?

For emerging adults (18-24), living in a group household typically met short-term (82%) but not longer-term (25%) aspirations. Similarly, living with parents mostly met short-term (76%) but not longer-term (30%) aspirations.

First home buyer schemes aren't enough to meet young adults' housing aspirations Australian Housing Aspirations Survey 2018, Author provided By early adulthood (25-34) the housing aspirations gap is greatest for individuals in the private rental sector, particularly those on higher incomes. For higher-income groups, their current private rental housing met the short-term aspirations of just over three-quarters (76%) but only 20% for longer-term aspirations. The aspirations gap is narrowest for home owners. Home buyers on low to moderate incomes were most happy with their housing in the short-term (92%) and longer-term (60%). First home buyer schemes aren't enough to meet young adults' housing aspirations Housing Aspirations Survey 2018, Author provided What can be done to close the aspirations gap? Very few people are actively planning for their housing futures. Affordability and the deposit gap, insufficient income, employment insecurity and “waiting for the market to settle down” all impact on achieving longer-term aspirations. In the short-term, not being in a preferred location, high mobility and insecurity matter most. Housing policy needs to become more realistic about the housing futures of young Australians. Achieving both short- and longer-term aspirations requires new policy frameworks that can enable young people to move towards attaining “secure independence”. Public debate about the housing aspirations of young adults gained prominence during the federal election with promises of a targeted scheme to help first home buyers. Proposed first home owner deposit schemes are an important step in meeting aspirations, particularly among private renters with higher and secure incomes. Read more: Small, but well-formed. The new home deposit scheme will help, and it's unlikely to push up prices But before young people even contemplate home ownership they need greater support in making key life transitions, such as from education to work, via more continuous and integrated packages of housing assistance. We also need continued reforms to ensure a fairer and more secure private rental sector with short and longer-term leasing options close to employment and training, and with stable rents. There needs to be diversity and real choice in dwelling types, size and locations and scaling up of more sustainable and niche models of co-housing. Read more: We need more flexible housing for 21st-century lives As for young people locked out of home ownership in the long-term, they need a way to build an investment nest egg and to access quality social and public rental housing.

Authors: Sharon Parkinson, Senior Research Fellow, Centre for Urban Transitions, Swinburne University of Technology

Read more


Altruistic or self-serving? Four things judges consider when sentencing politically-motivated crimes

This morning an Extinction Rebellion protester was arrested after hanging from a rope over the William Jolly Bridge in Brisbane, blocking all lanes to peak hour traffic. And earlier this...

Why do I dwell on the past?

Dwelling on the past, like writing in a diary, is part of being human and helps us form our identity. But not all memories are helpful.from www.shutterstock.comMany of us enjoy...

Surge in pre-poll numbers at 2019 federal election changes the relationship between voters and parties

Another issue is that pre-polling gives an advantage to the major parties over the smaller ones, due to the latter having fewer resources.AAP/Bianca de MarchiOn the morning of the last...

why memorising poetry still matters for human connection

Committing poetry to memory is so much more than a rote exercise.Taylor Ann Wright/UnsplashMemorising poetry was once common in classrooms. But it has, for the most part, gone out of...

what exactly does a showrunner do?

Donald Glover is the showrunner on Atlanta, 'perhaps the most curious credit in the history of the small screen'. imdb/FX NetworksWhat do J.J. Abrams, Phoebe Waller-Bridge, Shonda Rhimes, David Lynch...

How many people have eating disorders? We don't really know, and that's a worry

Eating disorders disproportionately affect females and young people.From shutterstock.comLast week, federal health minister Greg Hunt announced that more than 60,000 Australians will be asked about their mental health and well-being...

keep in mind the 'bacon and eggs' principle

Morrison describes the “the bacon and eggs principle" where "the chicken is involved, but the pig is committed".AAP/Shutterstock/The ConversationScott Morrison has a sharp lecture for bureaucrats about their KPIs, in...

Frydenberg outlines financial sector reform timetable

Treasurer Josh Frydenberg has issued a timetable for the government’s dealing with the recommendations from the royal commission into banking, superannuation and financial services, which aims to have all measures...

For the first time in centuries, we're setting up a generation to be worse off than the one before it

The avocado latte is indeed a thing, but young Australians are spending less on luxuries than they used to, while older Australians are spending more. ShutterstockEach new generation of Australians since...

Michelle Grattan on the Pacific Islands Forum wash-up, media freedom and the public service

Australian Prime Minister Scott Morrison has been at the Pacific Islands Forum in Tuvalu.AAP/Mick TsikasMichelle Grattan talks to University of Canberra Vice-Chancellor and President Professor Deep Saini about the week...

Pacific Island nations will no longer stand for Australia's inaction on climate change

The Pacific Islands Forum meeting in Tuvalu this week has ended in open division over climate change. Australia ensured its official communique watered down commitments to respond to climate change...

Glamorising violent offenders with 'true crime' shows and podcasts needs to stop

Even in death, the voice of Carl Williams is louder than that of his victims. Intimate prison letters written by the convicted murderer and drug trafficker to his ex-wife, Roberta...

Popular articles from Modern Australian

The Process Followed by Car Removal Companies5 Ideas for Small Melbourne BackyardsSplurge or Save: Our tips on what to Spend the Big Money on for your Wedding5 ways to make sure you have a good camping tripMouth Ulcer Treatment – The Easiest It Can GetLaser Treatment For Skin Tag RemovalThe Importance of Mental Health During PregnancyFavourite Pastimes for SeniorsHow to Dress for Work: Chic 9-5 StyleFind out how reading Funeral Poems can bring comfort to your griefWhat Men Like in Women’s FashionDocument you need for a divorce7 Steps Complete Guide to Sustainable Lifestyle5 ways to hydrate your hair and skin while you travelGreat Ways to Stay Fit When You are Busy