The latest housing occupancy figures from the Australian Bureau of Statistics (ABS) – based on data from its Survey of Income and Housing conducted from July 2019 to June 2020 – have provided us with a number of insights into the state of our relationship with property in this diverse landscape.

It's important to note that these figures are from the early stages of the pandemic, meaning the housing boom, record-low interest rates and rising rent prices will not be reflected in the stats.

Home ownership

The average Australian’s long-held proclivity for home ownership appears to be waning, although perhaps not by choice.

Around two-thirds (66%) of Australian households owned their home in 2019-20 – either with or without a mortgage.

This figures remains on par with 2017-18, however is down on the 68% recorded in 2015-16.

It’s actually Australia’s lowest rate of home ownership since the survey began in 1994, but it’s pretty much on par with the rates in countries with similar cultures, such as the United States, the United Kingdom, Canada and New Zealand.

However, it’s significantly higher than in Germany and Switzerland, where rates of home ownership typically hover around 40-50%.

Outright home ownership

But far fewer Australians own a home outright (i.e. without debt) these days compared to a decade ago. There’s actually more homeowners with a mortgage now than those without:

  • 30% of households own a home without a mortgage (down from 39% in 1999-00)
  • 37% of households own a home with a mortgage (up from 32% in 1999-00)

Renting in Australia

Meanwhile, renters (either renting from a private landlord or a state housing authority) now make up 31% of Australian households – a slight decrease from the 32% in 2017-18.

Most of these renters rent via a private landlord as opposed to from a state or territory housing authority:

  • 26% of households rent from a private landlord (up from 20% in 1999-00)
  • 3% of households rent via a state or territory housing authority (down from 6% in 1999-00)

Home ownership by state

Across the states and territories, the home ownership rate is highest in Western Australia (69.3%) taking over from Tasmania (72%) in 2017-18 and lowest in the Northern Territory (59%), which may relate to the average housing costs in those respective regions (see housing costs section).

  • New South Wales home ownership: 64% home owners, 33% renters
  • Victoria home ownership: 68% home owners, 29% renters
  • Queensland home ownership: 64% home owners, 35% renters
  • Western Australia home ownership: 69.3% home owners, 28% renters
  • South Australia home ownership: 69% home owners, 30% renters
  • Tasmania home ownership: 68% home owners, 29% renters
  • Northern Territory home ownership: 59% home owners, 40% renters
  • Australian Capital Territory home ownership: 69% home owners, 28% renters

Home ownership by age

The majority of Australians appear to spend much of their twenties circling the renting roundabout, with renters significantly outnumbering home owners in both the 15 to 24 and 25 to 34 age brackets. 

But the tables suddenly turn in the 35 to 44 age bracket with more people settled into home ownership – swapping roommates for spouses, house parties for house decor, bright city lights for babies…you get the picture.

Proportion of home owners and renters by age of household reference person:

  • 15 to 24: 10.4% home owners, 83.5% renters
  • 25 to 34: 40.7% home owners, 55.7% renters
  • 35 to 44: 56.7% home owners, 41.5% renters
  • 45 to 54: 72.0% home owners, 26.3% renters
  • 55 to 64: 79.1% home owners, 19.1% renters
  • 65 to 74: 81.7% home owners, 16.0% renters
  • 75 and over: 83.0% home owners, 12.9% renters

Australian housing costs

Unless you’ve inherited a 10-bedroom manor and spend your days dusting your Fabergé egg collection, you’ll be well aware that Australian housing comes at a cost.

Such costs include rent, mortgage repayments and rate payments.

According to the ABS, these were the average weekly housing costs across the different Australian households in 2019-20:

  • Home owners with a mortgage: $493 (up 40% from 1999-00, adjusted for inflation)
  • Home owners without a mortgage: $54 (up 50% from 1999-00, adjusted for inflation)
  • Renters (private landlord): $415 (up 50% from 1999-00, adjusted for inflation)
  • Renters (housing authority): $150 (down 3% from 1999-00, adjusted for inflation)

Across all Australian households, the average weekly housing costs were $317.

Between the different states and territories, the average weekly housing costs were highest in the Northern Territory ($381) and lowest in Tasmania ($218):

  • New South Wales average housing cost: $356
  • Victoria average housing cost: $319
  • Queensland average housing cost: $300
  • Western Australia average housing cost: $293
  • South Australia average housing cost: $251
  • Tasmania average housing cost: $218
  • Northern Territory average housing cost: $381
  • Australian Capital Territory average housing cost: $363

Housing affordability

The ‘affordability’ of housing in Australia is measured by the ABS as the ratio of housing costs to gross household income.

By this simplistic measure, the 2019-20 stats show that housing affordability has been pretty stable over the past decade, even improving for households with a mortgage.

Housing costs as % of gross household income, 2019-20:

  • Home owners with a mortgage: 15.5% (down from 16.6% in 1999-00)
  • Home owners without a mortgage: 3.0% (up from 2.6% in 1999-00)
  • Renters (private landlord): 20.2% (up from 19.3% in 1999-00)
  • Renters (housing authority): 19.5% (up from 17.9% in 1999-00)

However, it’s worth noting that the official cash rate was 6.00% back in 1999-00 compared to 0.25% in 2019-20.

While these are the latest results released from the ABS, they do not take into account the property market activity over the past two years. 

Australian property prices

For some context, property prices exploded by over 22% throughout 2021 - the strongest rate of growth since 1989 - and continued to rise through early 2022.

Also rents have risen at the fastest pace since 2008.

As a result, housing affordability is at a five-year low in terms of buying according to research from Bluestone conducted in October 2021.

Around the same time, Property Investment Professionals of Australia (PIPA) reported that below-average investor activity could put a 'further strain' on the already-tight rental market, warning of an incoming rental affordability 'crisis'.

Many renters are now 'worse off' than before the pandemic according to a research paper published by National Shelter, SGS Economics & Panning, The Brotherhood of St Laurence, and Beyond Bank Australia.

Owning housing for non-residential purposes

According to the 2019-20 stats, one in five Australian households – that’s 2.02 million – own property besides the one they’re residing in.

This includes those that own investment properties and/or holiday homes.

Of those:

  • 67.5% (1.36 million) owned one property (besides their current place of residence)
  • 20.4% (411,600) owned two properties
  • 7.7% (155,200) owned three properties
  • 4.3% (87,100) owned four or more properties

First home buyers in Australia

Let’s not forget about those taking their first step into property ownership.

According to the latest ABS household lending data (May 2022) owner-occupier first home buyers accounted for over 31.7% of all dwelling commitments.

This is significantly down on the 42% recorded in December 2020.  

Of the 420,000 first home buyers surveyed for the ABS in 2019-20:

  • 92% owned their home with a mortgage.
  • 61% were in a household with a reference person aged under 35 years.
  • 69% were either couple families with dependent children (41%) or couple only families (28%).
  • 17% of the dwellings recently purchased were new.

That last point is particularly interesting, given most first home buyer grants are restricted to those buying or building new properties.

It suggests that around more than three-quarters of first home buyers are forgoing government grants with a preference to buy an established home.

As for the types of property purchased by first home buyers:

  • 66.8% purchased a separate house.
  • 16.6% purchased a semi-detached, row or terrace house, townhouse.
  • 16.4% purchased a flat or apartment.

Throughout 2021, almost one in 10 first home buyers - or 33,000 - were backed by two government schemes: the First Home Loan Deposit Scheme (FHLDS) and the New Home Guarantee (NHG)

However at the same time, a quarter of borrowers failed to find a home under the Home Guarantee Scheme, which includes both the New Home Guarantee and Family Home Guarantee.

New government schemes geared at helping first home buyers break into the housing market continue to pop up, including the South Australian Government's $10,000 interest-free housing loan scheme, Victorian Government's Homebuyer Fund and the newly formed Federal Labor Government's Help to Buy shared equity scheme.

Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.

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Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of . View disclaimer.

Article originally published by Dominic Beattie on 19 September 2019, updated by Jacob Cocciolone on 25 May 2022.

Photo by Daniel Christie on Unsplash

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