Young Aussies still hopeful in owning homes despite economic pressures

The bank’s Home Truths survey collected responses from over 1,700 Australians in order to understand the needs, preferences and attitudes of those who already own or want to own a home in the future.

According to the bank’s findings, 73 per cent of Gen Z (14–25 years old) and 57 per cent of Gen Y (26–41 years old) in Western Australia still considered owning a home as an important goal regardless of the ongoing economic pressures.

With that being said, the two generations of home buyers were feeling the impact of the current economic environment of cost-of-living pressures, rising interest rates, increasing inflation and the tightening of property markets.

The number of Gen Z and Gen Y respondents in Western Australia who felt that home ownership was achievable was “adrift of those who felt it was important”, sitting at 50 and 46 per cent, respectively.

The pressures were most felt by the current generation of home buyers, Millennials, who previously rated achievability at 71 per cent in the Home Truths survey conducted in October 2021, showing a fall of 25 per cent in this year’s survey.

Concerns over housing supply, construction delays and affordability were also apparent, with 36 per cent of Gen Z and 46 per cent of Gen Y having said that they made significant changes due to interest rate increases.

Those changes included one-in-five Gen Z respondents (19 per cent) and one-in-10 Millennials (10 per cent) delaying or outright cancelling plans to purchase a home, along with 16 per cent of Gen Z and 23 per cent of Gen Y delaying or cancelling any major household spending.

Construction delay impacts were only highlighted by a quarter of in-market Western Australia home buyers who said they were likely to build, which was a 14-point drop since the October 2021 Home Truths survey.

Bankwest general manager of home buying Peter Bouhlas said that most Australians are facing some challenges due to the current combination of housing and rental pressures, supply chain challenges and inflation.

“Western Australia’s current and next generation of homebuyers are on the frontline of these impacts, with many having never experienced a rising rate market in their homeownership journey,” Mr Bouhlas stated.

“It is promising to see that, despite these pressures and economic headwinds, young Western Australians have not given up on the dream of owning their own home, and it’s important they are supported in navigating that goal.”

Mr Bouhlas continued by acknowledging that “challenging economic conditions may be here to stay for a while”, and emphasised the importance of encouraging all customers to ensure that they are in the “best possible financial position”, and to reach out should they need support.

Bankwest conducted a similar survey of 1,800 Australians in December 2021, revealing that 60 per cent of Western Australians looking to purchase a home felt the “goal was achievable”, compared to 37 per cent from 2020.

[RELATED: Confidence in home ownership grows, despite affordability concerns]