A new report from the Grattan Institute has shown that there is a decline in homeownership levels among the younger generations and those with lower incomes, bringing housing affordability back to the fore.
At the start of the 1980s more than 60 per cent of 25-34 year-olds owned a home across almost all income brackets. According to the Grattan Institute’s findings, that rate has now dropped below 50 per cent for all but the highest income group.
Unsurprisingly, after five years of unprecedented growth in property values, the biggest fall has been for those in the bottom 20 per cent of household incomes, where only a fifth of those under 35 own a home, down from nearly two-thirds just a few decades ago.
The report was released on the same day a NSW parliamentary inquiry was held to discuss housing affordability. Whilst the Grattan Institute argued the best way to address affordability in the long term was to increase the supply of townhouses, terraces and mid-rise apartments across inner-city markets, the inquiry was told that despite an enormous increase in housing supply in Sydney, we have seen little impact on property values.
This sentiment is backed up by a national property report by CoreLogic which found housing values across the country had fallen just 0.8 per cent since September 2016. And, although Sydney housing values were down 2.4 per cent last quarter, the city's median property price remains well over $1 million.