Generational housing crisis more than just a newspaper headline
The most affordable suburbs and regions may be the only refuge for first home buyers, young families, renters and key workers as the housing crisis takes a generational toll on society.
The housing crisis is not just a newspaper headline or catchphrase - we know it is real and having devastating effects across Australia.
It is a crisis of supply and affordability of such proportions that it has the potential to affect us all for many years to come.
Issues such as ongoing supply chain delays, skilled worker shortages, high interest rates and slow dwelling approvals, in combination, have the double impact on performance and profitability of the development sector as well as damaging access and affordability for prospective homeowners.
Australia’s current property market is unlike anything we have experienced before and it’s important to get behind the media headlines and remember that the housing crisis is not just a problem for those on low wages.
It is hitting households across the nation, including first home buyers desperate to get onto the property ladder; empty nesters who are reluctant to sell the family home and move into something smaller as they face limited supply; young families who want to buy those larger homes but can’t due to high house prices; renters who have to bid to secure a home but are increasingly priced out of the market; and, key workers who often face a long commute because there just isn’t anything available nearer work.
First home buyers’ daunting challenge
There are numerous barriers for aspiring first home buyers in Australia.
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The rising cost of housing has led to a national median home price of $779,819, making it even more difficult to achieve the dream of owning a home in such a highly competitive market.
Then there is the challenge of saving up for a large deposit while juggling other financial commitments and waiting in long lines with other prospective purchasers and seeing bids being taken on properties.
These have become the norm and are pushing house prices even higher.
The combination of rising interest rates and the recent evidence of mortgage stress add to the fear that first-time buyers may experience of being unable to meet mortgage repayments.
In the long run, this can deter them from taking the step into homeownership.
Potential homeowners may have to compromise on desired location and property type and are therefore encouraged to look beyond the typical detached houses and consider the more affordable options of apartments, townhouses or properties in their local area.
Nation’s most affordable suburbs
We also know that during Covid, large numbers of Australians moved to outer suburbs or into regional areas.
This is something still evidenced in recent data from realestate.com.au which shows the suburbs that might be within reach of first home buyers and which include amenities or links to employment hubs.
In Victoria the data shows the top three most affordable suburbs are Thomastown, Mickleham and Altona Meadows.
In Queensland its Morayfield, Darling Heights and Darra.
NSW lists Hamilton, Mayfield and Armidale, three areas that are part of the Greater Cities Region.
Western Australia shows Mandurah, Armadale and Rockingham, while South Australia lists Morphett Vale, Salisbury and Parafield Gardens. For those keen to jump onto the Spirit of Tasmania, head to Rokeby in that state for affordable homes.
The path to homeownership in 2024 can be a long and winding road, and there will undoubtedly be challenges along the way.
Government assistance programs such as the First Home Loan Deposit Scheme and First Home Owner Grants, together with investment and a range of incentives announced in the 2024-25 Federal Budget to enable housing supply to meet the National Housing Accord target of 1.2 million homes over five years, are welcome steps that can help first-time buyers get into the property market.
We know we cannot solve the housing crisis alone.
Our industry will continue to work with State, Federal and Local governments to do everything we can do to turn it around, not just for now, but for the future generations of Australians, so that they can still realise their dream of homeownership.
