The number of Australians who own their home outright has fallen significantly over the last 25 years, but this drop is a symptom of a 50-year trend, CoreLogic has said.
The proportion of Australians who own their home outright slid by 110 basis points between 2011 and 2016, but the difference between 2016 and 1991 is even starker.
According to 2016 Census data released by the Australian Bureau of Statistics on Tuesday, 31 per cent of Australians owned their homes outright in 2016, down from 32.1 per cent in 2011. However, 25 years ago 41.1 per cent owned a home without a mortgage.
Cameron Kusher, the head of research at CoreLogic, said the census results weren’t surprising and that rates of home-ownership have been declining for the last 40-50 years.
He commented: “Fewer people owning their home outright … is reflective of the fact that the price of housing is substantially higher.
“Also, you’re seeing a bit of a creep up in the number of people that are renting and I think that’s reflective of the fact that it is very difficult to get into some of the housing markets.”
Between 2011 and 2016 the percentage of mortgagors remained steady, dropping slightly from 34.9 per cent to 34.5 per cent, while the percentage of renters grew from 29.6 to 30.9 per cent.
In 1991, renters made up 26.9 per cent of the market and mortgagors 27.5 per cent.
Rent and mortgage payments
As the proportion of renters grow, so to do their rent payments, with the percentage of households spending more than 30 per cent of income on weekly rent payments growing from 10.4 per cent in 2011 to 11.5 per cent as of census night 2016.
At the same time, the number of households where mortgage payments are 30 per cent or greater of household income has decreased since 2011, dropping from 9.9 per cent to 7.2 per cent.
Mr Kusher predicted that increasing rates of renters would continue to a point but at some stage would “hit a bottom”. However, as to what happens then, “who knows”.
He noted that Baby Boomers had accumulated significant wealth and as they move into retirement or pass away, some of that wealth could be passed to children and grandchildren, facilitating market entry.
Number of people per household
Between 2011 and 2016, the average number of people per household remained at 2.6, however in 2016 almost one household in four (24.4 per cent) was a lone person household, ticking up slightly from 24.3 in 2011. In 1991 this figure was 20 per cent.
The rate of unoccupied private dwellings rose from 10.7 per cent in 2011 to 11.2 per cent in 2016.
[Related: Housing sentiment hits record low: CoreLogic]