With skilled migration often having favoured those in the 21-30 age bracket - and with the average age of the first homebuyer having increased over time - there is presently a relative dearth of people in the first homebuyer age brackets. Rolling demographic projections forward it is not until 2021 that potential first homebuyers reach a critical mass which might be considered compelling, with the number of 31 to 38 year olds in particular mushrooming to a total of more than 3.1m (from around only 2.6m in 2014). In the period through to 2027, that number is projected to have expanded further still to more than 3.3m. As this effective "spending wave" passes through 2021, therefore, the demographic factors for Australian housing market growth look to be particularly favourable from that year until around 2027 inclusive. Over the short term however with an erosion of yields, population growth slowing appreciably, and dwelling completions set to remain elevated for the next few years, housing market dynamics over the next few years look increasingly underwhelming. (VIEW LINK)
Great post Pete and some great information on demographics.
Do you think the type of apartments being built at the moment are being built for a specific investor market and will they be as appealing in the secondary market as some of these first homebuyers come back as suggested in the stats you present?
Absolutely this is a key issue. Developments is much being skewed towards the new investor market, particularly offshore buyers - and particularly so in Melbourne and Sydney. We have changing demographics, but still we're building far too much high rise as the ABS data for 4+ storey units shows.