Age no barrier to buying your first home
AN EXPENSIVE and competitive housing market, combined with unstable employment, means first home buyers are getting older.
According to recent data released by the Australian Bureau of Statistics, people who are buying their first home are older than they were more than a decade ago.
This means buyers who get their first step on the property ladder while aged in their late 20s and 30s could still be paying off their mortgage when they reach retirement age.
Add to this the trend of city dwellers looking to swoop into regional areas with their more affordable housing options, it means older first home buyers might not be able to reach or sustain the great Australian dream.
The most recent ABS Survey of Income and Housing revealed in 2000-01 more than 60% of first home buyers were aged 25 to 34 years, however by 2013-14 that percentage had dropped to just under half (49.6%).
Other ABS Housing Occupancy and Costs data shows the proportion of households aged 65 years and over still paying off their mortgage has more than doubled, having risen from 3.6% of all households aged 65 and over in 2000-01 to 8.2% in 2013-14.
The Australian Housing Urban Research Institute's Professor Terry Burke said 20 years ago, people older than 45 years predominately owned their own home outright.
"But now a very large percentage of them are purchasers,” he said.
"It means many older purchasers are going to be carrying their mortgage when they reach retirement age but may not have the level of pension, savings or super to sustain the mortgage.”
Prof Burke said the housing situation was only going to get worse.
"It will put increasing pressure on government about the level of superannuation at a time when they are under pressure to cut costs,” he said.
"And regional areas have a disproportionate number of people looking to buy, as house costs are lower than capital cities.”
He said parents guaranteeing a child's mortgage with their own property, could be in jeopardy if the son or daughter couldn't sustain their payments.
Mortgage broker George Smith-Roberts said the average age of people signing up to buy their first home were in the middle of this demographic.
"About 20% of first home buyers I see are aged 30 to 40,” he said.
"It's never too late to look at buying your own home.”