Dream of home ownership slipping away
The dream of home ownership for young Australians is slowly slipping away from them.
Most university graduates start their working life with a HELP debt that is typically $25,000, depending on the degree. For medicine it is more than $40,000. In 1992, the average student debt was $7000.
"This is a major barrier to getting into the housing market," says FYA's Jan Owen. With high property prices, young first-home buyers take on three times as much debt as their parents. In 1975 it took three years to save for a home deposit and the price was typically four times an annual salary. These days it takes nine years to save and a home costs around 12 times annual salary.
For young people, the great Australian dream of owning a home can easily turn into a nightmare. In 1975 people had secure jobs but now more casual work and uncertainty mean it is harder for kids to have the secure income needed to make regular mortgage payments. Casual jobs often don't provide benefits such insurance, or holiday, sick and parental leave.
Also kids don't start out earning that much more than their parents did - only 6.8% more, after adjusting for inflation, according to FYA. Not surprisingly, only 22% of young Australians believe their lives will be better than their parents'.