Australians Renting for Longer as Housing Dynamics Evolve
In the ever-evolving tapestry of Australia’s housing landscape, a noticeable trend has emerged. More Australians are choosing to rent. They are renting for more extended periods than ever before. This paradigm shift is backed by comprehensive data from reputable sources.
In-depth Analysis Based on Latest Reports from Australian Bureau of Statistics, Australian Institute of Family Studies, AHURI, and Digital Finance Analytics.
The Aging Face of Renting.
A stark indicator of this trend is the median age of first home buyers where the typical first home buyer has undergone a significant transformation over the past two decades. In the year 2000, the median age of first home buyers was 25; fast forward to 2020, and it has risen to 33. This substantial increase suggests a fundamental change in Australians’ approach to housing. More individuals and families are opting for the flexibility and freedom that renting provides.
Private Renting on the Rise.
Another compelling facet of this shift is the surge in the percentage of people in private rentals. In 2000, 20% of Australians rented privately, by 2020, this figure had climbed to 26%, marking a 30% increase over two decades. The dynamics of housing tenure are undergoing a transformation. As a result of homeownership being ever more out of reach, people are renting for longer.
Supply and Demand Dynamics in Rental Housing.
Whilst demand for rental properties is on the rise, the proportion of renters under state or territory housing authorities has decreased from 5.8% in 2000 to 2.9% in 2020. This decline is not indicative of a lack of demand. Rather a stark shortage in supply. As more Australians find themselves in the rental market with rental prices increasing, it will become crucial to address this supply demand imbalance.
Australia is experiencing a significant shift in housing patterns. Renting is becoming a more prominent and enduring choice for a growing number of individuals and families. As this trend continues, addressing the challenges of supply and diversity in rental housing becomes paramount. We need to ensure that Australians can access housing that meets their needs across various life stages. Professional management and innovative solutions, such as Build to Rent assets, hold the potential to reshape the rental landscape for the better.
To learn more about how the Australian Build to Rent landscape is evolving, Franklin St. have prepared The BTR Equation.