Millennials are more optimistic about achieving home ownership than the oft-maligned baby boomers.
The idea of young Aussies being reckless with their money has been smashed with research showing more than half are willing to go without the little luxuries, like weekend brunches, to afford a house.
The results were revealed in a national survey from Bankwest, which showed millennials still believe in the Great Australian Dream of home ownership and are willing to make big sacrifices to achieve it.
In a blow to the 'smashed avocado' trope - made famous by renowned demographer Bernard Salt - over half (57.7%) of millennials said they would be happy to go without the little luxuries in life such as coffees, weekend breakfasts and streaming subscriptions, while 56% said they were willing to sacrifice holidays to save for a house deposit.
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A quarter said they would be prepared to delay their dreams of starting a family, move back in with their parents, and even cut back on necessities like groceries, meals, clothes and heating/cooling costs to save.
Despite increasing house prices and the rising cost of living, it appears the Great Australian Dream is still alive and well for millennials. Nearly half of millennials (46.6%) said they still believe in the Great Aussie Dream of owning a home, compared with 36.5% of Gen X's and 43% of Baby Boomers.
Interestingly, over half (55.2%) of Baby Boomers said they don't believe home ownership will ever be achievable for them compared with less than a quarter of millennials. It comes after data from the National Housing and Investment Corporation (NHFIC) found that 11% of applicants for the First Home Loan Deposit Scheme were between the ages of 40-59.
Bankwest General Manager Personal and Third-Party Banking Donna Dalby said the results smash the stereotype that millennials are frittering away their money.
"These results are really promising and paint a very different picture of young Australians to the one we usually hear," she said.
"This is not a bunch of carefree kids ignoring the future for an indulgent moment; this is a group of people who have financial goals they want to achieve and are willing to sacrifice big to do that."
However, only one-in-five (19.9%) of millennials said they knew exactly how much they needed for a deposit, while a similar number (20.1%) said they made a savings plan but failed to stick to it.
More than two in five millennials (41.3%) said they made a savings plan and were able to stick with it, while 58.4% admitted to having a rough idea of how much they would need for a house deposit.
The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:
- The big four banks are: ANZ, CBA, NAB and Westpac
- The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2019. They are (in descending order): Credit Union Australia, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
- The larger non-bank lenders are those who (in 2020) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.
Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site.
In the interests of full disclosure, Savings.com.au, Performance Drive and Loans.com.au are part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.
*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.
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