New Generation Rent research shows more renters determined to buy despite cost-of-living pressures
Amid soaring rents and rising property prices, first home buyer demand is rebounding just in time for the traditional Spring property season according to the annual Generation Rent Report from national network of mortgage brokers, Resolve Finance.
According to a nationwide panel of more than 1000 renters, 57% of renters are planning to buy their first home or investment property in the next two years, compared with 42% last year, an increase of 36%. This signals a resurgence of first home buyer activity despite affordability challenges.
Resolve Finance Managing Director Don Crellin said the findings reflect a turning point in buyer sentiment.
“Many Australians, particularly younger buyers, are no longer waiting on the sidelines. Instead, they are finding new ways to enter the market, from purchasing with family or buying an investment property first, to using government assistance. Some lenders are prepared to work with buyers to consider future rental income from spare rooms when assessing affordability,” Mr Crellin said.
The highest proportion of renters planning to step onto the property ladder in the next two years was the 35-to-49-year age bracket at 65%, this was followed closely by 25-34 year olds at 62% and 18-24 years olds at 54%.
Victoria emerged as the strongest market for aspiring first home buyers, with 62% of renters planning to buy within the next two years, compared to 56% of those renting in NSW and 54% of renting Queenslanders. In both metro and regional areas Victorians were the most likely to purchase (65% and 56% respectively).
While optimism is building, affordability pressures remain acute. Rapidly rising property prices were the most common barrier cited by Generation Rent (54%), followed by high rents (38%) and broader cost-of-living pressures, which have delayed buying plans for 65% of renters.
Saving remains the most common way to fund a deposit (82%), followed by government grants and schemes (36%) and family support (15%). Nearly half (48%) plan to buy alone, while 44% expect to buy with a partner.
Mr Crellin said: “This Spring we’re seeing a genuine first home buyer comeback. Despite the challenges, more renters are determined to make the leap into homeownership. Not surprisingly, the timing aligns with increasing Government support of the Housing Australia schemes, such as the First Home Guarantee scheme, designed to support First Home Buyers. These survey results highlight our first home buyers, resilience, creativity and confidence in the future.”
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