Young FHBs rise over FY20: ABS

According to the Australian Bureau of Statistics latest Housing Occupancy and Costs paper, which accounted for the levels of housing occupancy and costs every second financial year, the country’s home ownership remained relatively consistent compared to previous findings. 

As stated by the ABS, two-thirds (66 per cent) of Australian households reportedly owned their homes over the 2020 financial year – the same figure reported during FY18 and 2 per cent lower than FY16. 

Mortgage owners were reported as the vast majority of these owners, accounting for 36.8 per cent of households – a 10-bp lift from 2018’s 36.7 per cent. 

Further, roughly 4 per cent of home owners over 2019 and 2020 owned at least four properties, dropping from the 5 per cent reported in the bureau’s preceding report. 

This stable trajectory was also observed in mortgage expenses, with average weekly housing cost falling from $498 to $493 between FY18 and FY20.

Household spending as a proportion of gross household income also fell by 40 bps over this same period for those with a mortgage, dipping from 15.9 per cent to 15.5 per cent.

However, what was distinctive comparative over this two-year period was the percentage of young Australians as first home buyers. 

According to the ABS data, there were just under 1.12 million home buyers over FY20, lifting from the roughly 1.01 million purchases two years earlier. 

More than one-third of these purchases (38 per cent) were made by FHBs, again marking a rise of the 35 per cent reported during FY18. 

However, the vast majority of these FHBs were aged between 25 and 34 and accounted for over half (56.1 per cent) of the nation’s first home buyers over FY20. 

This latest figure is a boost from 2018, lifting up from the 49.6 per cent recorded at the time. 

While this rise suggests more young Australians were purchasing new homes, this latest ABS data saw an increase of older Australians purchasing new homes. 

According to this latest report, the number of changeover buyers – or, recent home buyers who had previously owned their own home – over the age of 65 lifted from 20.8 per cent to 24.1 per cent.

However, this momentum for first home buying comes in the wake of measures designed to stimulate that behaviour, with the Morrison government launching its First Home Loan Deposit Scheme at the commencement of 2020. A scheme that, since its launch, saw criticism over who it exactly benefited.

Speaking at the time of the FHLDS release, CoreLogic’s head of Australian research Eliza Owen commented that the scheme’s eligibility criteria potentially made it a pathway that would “advantage to those earning towards the top of the threshold”.

“The FHLDS, in its current state, risks awarding home ownership to those who may have otherwise attained it with time,” Ms Owen later said.

This concern was echoed in late 2021, when a statutory review of the National Housing Finance and Investment Corporation (NHFIC) Act 2018 concluded that the FHLDS mostly benefited FHBs who would have been able to purchase a property in less than two years.

[Related: New home loans reach record high]