Future of the Australian real estate market
A milestone that hundreds of thousands of Australians strive to achieve is to own their very own house – often by their mid-thirties. Massive backyards, hills hoist and barbeque gatherings are all stereotypes of the ‘Australian dream’.
However, recent data shows that there may be an up hill battle in store for Generation X and their Millennial siblings’ looking to achieve early home ownership. A report released by LF Economics indicates the size of an average home loan has grown by over 43% since 2012, to an approximate size of $424,000.00. In contrast, the average wage has only seen an increase of 10% over an identical period.
In Sydney, the decline in household affordability is most prominent, with a median house price upwards of $1m, this places average prices in the threshold of 12 times more expensive than the equivalent value 30 years ago.
According to an article posted by researchers from the Grattan Institute, younger generations may very well be amongst the first in the country’s history to be poorer than their parents at the same age.
Buying real estate in major cities or developing towns is no longer a viable option for Australian’s in 2016. Many investors or first-home buyers continue to rent, or move to country suburbs to chase their ambitions
The solution to combat the impeding real estate crisis is to spread more knowledge surrounding the benefits of personal financial planning. Not only does this encompass taking long positions on various equities or putting money towards bonds and other such financial vehicles, but learning how to manage your budget and most effectively allocate your money.
Concerned about the economic climate or the state of the real estate industry? Then check out the services we have on offer, so we can get you started on the right path to a successful retirement!