House prices represent new opportunity
In a coup for local homeowners, experts say the housing market is on track to rebound, but for many young people the dream of owning a home is slipping further out of reach.
A snapshot of local residents conducted by the Telegraph showed those living in Rockingham and Kwinana were attracted by low house prices and being close to the beach.
Young families like the Ellises, of Waikiki, and the Secliers, of Baldivis, said the area gave buyers the best bang for their buck.
But as house prices continue to climb faster than incomes, many young people are being priced out of the market.
Curtin University’s head of economics and property, Steven Rowley, said the gap between incomes and house prices would continue to widen in the next decade unless something was done to address housing demand.
He said many young Australians and low income earners were struggling to enter the market which could have serious knock-on effects in the future.
“The biggest problem is trying to deliver housing options for those on low incomes that cannot afford to access market housing without having severe housing affordability issues which can lead to poverty, mental health issues and potentially homelessness,” he said.
“Housing delivered by the State Government (public housing) and community housing providers (broadly social housing) is vital to provide affordable housing to those on low incomes.
“Without investment in such housing, and it is expensive to provide, more and more households will struggle to survive in the private rental market, many of which will become homeless.”
For Meadow Springs student Tye Turner, buying a house remained a distant dream.
“I’m not even thinking about buying a house for the next five years ... it seems far too expensive at this stage,’ he said.
His story is common among millennials in the area who are forced to double up on debt, rely on two incomes or move further out of city centres to gain a foothold in the sky-rocketing property market.
Less than half of people aged 25-35 now own their own home, compared to 61 per cent in 1981, according to a report by the Australian Housing and Urban Research Institute.
Mr Rowley said the State Government’s Keystart program had provided housing opportunities for moderate income households but more affordable housing was needed.
Housing Minister Peter Tinley admitted there was a significant shortage of affordable housing options for low and moderate income earners.
But he said incoming Commonwealth schemes could provide some relief.
“There is no single solution to these challenges and we need to all work together to improve housing supply, affordability and the range of housing options for people struggling with affordability — from social housing right through to home ownership,” he said.
“One promising initiative is the Commonwealth’s announcement that it will establish a National Housing Finance and Investment Corporation which will look to increase private sector investment in social and affordable rental housing. It is important that our housing market is well placed to respond to future demand. The State Government has a role, as does the Commonwealth, local government and the housing industry.”
Shadow Housing Minister Peter Collier was approached for comment.
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