FORGET the housing preferences of baby boomers and spend a minute thinking about the younger generations, known broadly as generation X, generation Y and generation Z.
Foreseechange’s Charlie Nelson said housing affordability is one of the biggest issues facing younger generations (those born after 1965), many worrying they will never be able to afford to buy a house.
KPMG demographer Bernard Salt said simple population mathematics means generation X, Y and Z will never see the kind of property price growth that baby boomers did, thereby missing out on the “leg-up” baby boomers received when they bought property.
He said land values increased by 4000 per cent between the 1960s and 2003 as the demographic strength of 4 million baby boomers created demand for 2 million more houses than existed previously, and drove up prices.
Furthermore, Salt predicted that the Sydney suburbs that will have above-average property price growth will be inner-city and beachside locations that appeal to both the baby boomers and generation X and Y – the Zs, born from 1995, are still too young to buy or rent.
But experts like BIS Shrapnel’s Jason Anderson said the “value proposition” for generation X and Y – who are unlikely to have the same housing equity baby boomers have built up – means Sydney’s middle- and outer-ring suburbs will appeal to younger first home buyers.
Anderson believes rising rents will prompt people aged in their 20s and 30s to start considering buying well-priced houses and apartments in western Sydney.
“Obviously they will want to be as close to the city as they can afford, but when they weigh up the cost of renting versus the cost of buying it will start making sense to them,” he said.
“There are gen X strongholds in new estates around Kellyville and Rouse Hill, but a lot of Xers did not marry or have children, and would die rather then move west of Leichhardt.”
The Bureau of Statistics said the number of single-person households in Australia is likely to increase by 57-105 per cent by 2026, and the average household size will drop from 2.6 to 2.3 people during the same time.
Salt predicted many generation X and Ys won’t have as many children as previous generations.
Filmmakers Allanah Zitserman and her partner Stavros Kazantzidis love the bush, beach, city and country – and have an apartment in Tamarama and and a weatherboard house with wraparound veranda in Dungog, three-hours’ north of Sydney in the upper Hunter Valley.
“The city is a time-sucker,” said Ms Zitserman, who started the Dungog Film Festival, co-wrote and produced Russian Doll and is now working on a new film, The Eucalypt Forest.
Mr Stavros said it takes a particular type of person – and plenty of research – before taking the plunge and moving to a more affordable rural area.
The couple researched Dungog thoroughly before buying.
“It’s important to know the psychology of a town, what it’s really like, before you move there,” Ms Zitserman said.