While it has been widely acknowledged the COVID-19 pandemic is reshaping Aussies’ behaviours in a range of ways, new research from Westpac has given firmer shape to how it has affected Australian home ownership goals.
The bank’s data revealed the number of first home buyers (FHBs) looking to enter the property market in the next five years has doubled from 7% before the pandemic to 16% now. The majority of respondents (54%) named no longer wanting to pay rent as their driving reason to get on the property ladder, followed by seeking more stability (39%) and financial security (37%).
According to Westpac managing director of mortgages, Anthony Hughes, more Australian pursuing the “sense of independence and stability” that home ownership provides makes a lot of sense given the widespread uncertainty of recent months.
“It’s encouraging that so many Australians are thinking about home ownership despite some of the challenges brought about by the pandemic,” he said.
“Even though younger generations have been some of the most financially impacted this year, it’s positive that many have really used this time to take stock of their finances and get serious about their long-term goals.”
Nearly half (48%) of those surveyed are more optimistic about entering the housing market now than they were 12 months ago, naming factors such as house prices (38%), low interest rates (24%) and the opportunity to live in a new area (24%) as reasons why.
Notably, seven in ten (69%) of the respondents who are currently cohabitating with housemates, parents or in-laws expressed determination to get out and get their own place.
“It’s also interesting to see this is now largely being driven by Gen Z, who after being cooped up at home during restrictions are now ready to leave their housemates or parents behind for a place of their own – many of whom might not have considered this a possibility prior to COVID-19,” Hughes said.
The Westpac research also found that nearly half (48%) of those surveyed said COVID-19 has caused them to re-consider the type of suburb or area they want to live in.
“While we’re seeing an increasing interest in properties that offer more space, there’s still a strong desire from first home buyers to live somewhere that’s still only about 20-30 minutes away from the CBD,” Hughes elaborated.
“With a younger generation of buyers emerging, many are also weighing up areas that would enable them to maintain a certain lifestyle, like Sydney’s Inner West which is in close proximity to social hubs and nightlife, while also catering to changing needs like the ability to work from home more.”