HOME OWNERSHIP SHUNNED FOR LIFE AS TENANT
Written on the 21 October 2015
MORE Aussies appear to be taking the advice of the Reserve Bank of Australia by opting to be tenants rather than homeowners, and more of them are taking up leases in units rather than houses.
Master Builders' deputy executive director Paul Bidwell says the latest ABS trends are reflected in the Master Builders Survey of Industry Conditions (SIC) for the September 2015 quarter.
Survey respondents were confident the trend to more units will continue, with 75 per cent expecting to see more units than detached houses developed.
In a significant turnaround, the majority expect detached houses and units to be smaller. Blocks of land are also expected to continue to decrease in size.
A research paper published by the RBA last year indicated Australians were better off renting than buying. The conclusion was based on a 2.5 per cent growth in house prices over the past 60 years and expectations that this historical price growth would not be sustained.
However, low interest rates may be testing the RBA's 2014 conclusion, with the latest ABS statistics showing renters are facing higher costs than those with a mortgage.
The ABS says rental costs have risen from an average of $328 per week in 2011-12 to $340 in 2013-14, while the costs of paying a mortgage have remained relatively stable.
The latest ABS statistics for Queensland in 2013-14 also show 63 per cent of people own or are paying off their own home down from 70 per cent in 1994-95.
"Along with the shift towards renting, we are also seeing a gradual shift towards units and away from detached houses," Bidwell says.
"Of Queensland's 1.765 million dwellings 79 per cent are detached houses, down slightly from 82 per cent in 1994-95.
"However, of the 44,000 dwelling approvals for 2014-15, only about 50 per cent are detached houses. If this trend continues, we will witness a major shift in the type of housing that Queenslanders live in.
"The ABS statistics also show the average household size is 2.6 in 2013-14. This is down slightly from 2.7 in 1994-95. Interestingly, the average number of bedrooms per dwelling increased during the same period up from 2.9 to 3.2."