If you’re interested in becoming a successful property investor, my chat today with leading demographer Simon Kuestenmacher will be of real benefit to you, because we’re going to talk about a demographic trend that is critical in understanding how our property markets will work moving forward.
What is this trend?
Probably not the trend you’re thinking about.
Considering homeowners makeup 70% of our property markets, I think you’ll benefit from today’s chat.
Home Ownership Demographic Trends
We often talk about Australians' passion for homeownership and how we are different from other parts of the world but are we really?
Is Australian home ownership comparable with homeownership internationally?
By international comparison, the Australian homeownership doesn’t appear to be overly high or low.
Largely agrarian and industrial economies like Romania, Hungary, and Bulgaria have high homeownership rates, while highly urbanized service economies (Switzerland, Germany, South Korea) have relatively low homeownership rates.
What does the census say about the percentage of renters in Australia?
In 2006, only 26 per cent of Australians (individuals not households as measured by the OECD) lived in a rented dwelling and by 2016 this number increased to 30 per cent.
Sure, today more people choose to rent as they move frequently for work opportunities (especially in their 20s and 30s before they have kids).
What’s happened to the percentage of homeowners based on age group over time?
People born in the late 80s/early 90s have a homeownership rate of 37%.
Their parents’ generation was 50-55%.
Every generation has a lower homeownership rate than the one before it.
The two big benefits of homeownership:
1.) Owning a home is the most important factor in staving off poverty in old age.
2.) A homeowner builds the best house they can possibly afford. An investor or developer purchases the cheapest thing they can get away with. Homeowner homes are therefore of better quality.
The type of houses Australians built in the past is very different from the modern home of today.
Migrants have brought their preferences and styles with them and have changed the way homes look and the way we live.
That is likely to continue.
With our governments having a business plan to increase their population by around 40 million people by the middle of the century, that will impact what the home of the future looks like?
Links and Resources:
As our markets move forward why not get the team at Metropole to build you a personalised Strategic Property Plan – this will help both beginning and experienced investors.
Some of our favourite quotes from the show:
“Australians seem to be obsessed with homeownership.” – Michael Yardney
“The modern home of today is very different.” – Michael Yardney
“You’ll never regret taking a vacation, engaging in a new hobby, or spending a day with those who make you happy.” – Michael Yardney
PLEASE LEAVE US A REVIEW
Reviews are hugely important to me because they help new people discover this podcast. If you enjoyed listening to this episode, please leave a review on iTunes - it's your way of passing the message forward to others and saying thank you to me. Here's how
Subscribe & don’t miss a single episode of Michael Yardney’s podcast
Hear Michael & a select panel of guest experts discuss property investment, success & money related topics. Subscribe now, whether you're on an Apple or Android handset.
Need help listening to Michael Yardney’s podcast from your phone or tablet?
We have created easy to follow instructions for you whether you're on iPhone / iPad or an Android device.
Prefer to subscribe via email?
Join Michael Yardney's inner circle of daily subscribers and get into the head of Australia's best property investment advisor and a wide team of leading property researchers and commentators.