Millennials: Catalysts of Change in Australia’s Housing Market
Real Estate Market Update with Leigh Martinuzzi MPG
Millennials are emerging as a driving force, reshaping the housing landscape with their distinct preferences and behaviours. Born between 1981 and 1996, Millennials, comprising individuals aged between 28 and 43, wield considerable influence over housing trends and demand.
With over 5.84 million Millennials in Australia and an anticipated annual increase of 108,250 over the next five years, this generation is poised to significantly impact the housing market. Various factors, including economic conditions, lifestyle choices, and societal trends shape their housing preferences.
Flexibility and mobility rank high on the list of Millennial priorities. Many prefer renting over homeownership, valuing the freedom to relocate for career opportunities or lifestyle changes. However, affordability remains a significant challenge, with rapidly rising property prices outpacing wage growth.
Despite aspirations for homeownership, many Millennials delay entering the market, opting to rent or cohabitate until they can afford to buy. When they do enter the market, they prioritise properties aligned with their values, such as energy efficiency, sustainability, and technological integration.
Data insights reveal a surge in population growth, with 635,000 people added in Australia last year. This influx, concentrated mainly in capital cities and surrounding urban areas, amplifies demand for housing, exacerbating affordability concerns.
Addressing the housing crisis requires proactive measures from local councils and governments. Immediate solutions are needed to enhance housing affordability and availability, fostering innovation and collaboration to shape a more inclusive and sustainable housing market.
Millennials are driving demand for flexible, affordable, and community-centric housing options, shaping the future of housing in Australia. As we navigate these shifts, let’s work together to explore solutions that meet the housing needs of today and tomorrow.
Additionally, recent economic indicators shed light on the broader market landscape. The latest weekly Inflation Expectations stand at 5.0% for the week of April 15-21, 2024, in line with the average over the last 12 weeks. Recent increases in petrol prices have renewed upward pressure on inflation expectations, despite a drop in the official inflation readings over the last few months.
Australia’s home prices continue to set records, with the combined capital house and unit prices experiencing another quarter of growth. Several home price records were broken during the first quarter of 2024, highlighting the persistent strength of the housing market.
