For the dwindling number of young Australians still clinging to the dream of owning their own home, it’s increasingly a tough choice between starting a family or saving a deposit.
New research commissioned by Real Insurance found two-thirds of people believe the goal of buying property is a thing of the past and 91 per cent value happiness above a mortgage.
But for those still hoping to take their first step on the ladder, 36 per cent said they’ve put plans for having children on hold, while almost all have cut back spending.
It’s a reality Melbourne couple Erin Keane and Brad Hollicks have come to terms with since deciding to buy a home together two years ago.
“We’ve been saving for ages,” Ms Keane told news.com.au.
“It’s required us to cut back on our spending a lot. My family is in Sydney so I’ve had to really reduce how often I go back to visit. It’s hard because I miss them.”
They’ve had to sit down for some serious discussions about the future together too, she said.
While most of their mates are marrying and having children, Ms Keane, an admin worker, and Mr Hollicks, a 27-year-old plumber, have decided to hold off for now.
The cost of a baby coupled with the belt-tightening required for a deposit seem impossible to juggle, Ms Keane said.
“I’ve always wanted to own a home to raise a family in before having kids. It’s quite important to me to have a bit of security and certainty first,” she said.
Like many other young couples in their situation, they’ve also avoided splurging on themselves.
“We were planning to go to Europe next year. We got the quotes and realised that we should probably put the money towards buying a house instead,” she said.
“Europe will always be there and it’s in our best interests to focus on buying. It’ll all be worth it in the end.”
The research found the majority of would-be first homebuyers have made changes to their lifestyle to save for a deposit faster, with 70 per cent reducing spending on clothing, 62 per cent slashing their budgets for hobbies and sports, and half forgoing travel.
While property prices have slid in many capital cities, first-timers are still battling to buy due to lending crackdowns by the banks.
And despite the doom and gloom recently, Ms Keane said the market is still very competitive.
“We went to a few auctions recently for properties that we really liked, but we couldn’t compete,” she said.
“Even though everyone says the market is down it definitely doesn’t feel like it to us. It’s so disheartening to find something you like and then you don’t win because you can’t afford to bid 0,000 more (than the guide) to beat others.”
The research found 87 per cent of Aussies feel locked out of the property market due to the amount required for a deposit.
The same number also report low wage growth as a reason for struggling, which is perhaps why 33 per cent have taken on more work.
Of those who have given up on buying property, 45 per cent said they’re saving money for travel and rate being health and enjoying life as their biggest goals.
Property value firm CoreLogic reported this week that Sydney’s price decline is bigger than the fall in the 1989-91 recession, at more than 10 per cent.
Melbourne is not far behind, while Perth is miles ahead, having started its price falls years ago.
South Australia, Tasmania and the ACT are faring much better, but even they are not immune to the negative effects on the national economy.
Since last year, Australia has lost 45 billion in housing wealth, according to the most recent Australian Bureau of Statistics preliminary numbers on the value of the total dwelling stock.