Generation Y becoming savvier with property
There may be more active young buyers in the residential property market in the next five years, after new research has shown that Generation Y is becoming more interested in the idea of buying a property.
According to research from Australian online retailer Co-Op, 94 per cent of the 2,000 young survey respondents stated that they have intentions to buy property in the next 5.6 years.
The young respondents were aged between 17 and 29 and consisted of a mixture of students with an average age of 22.5 years.
Findings from the survey also found that this younger generation is placing their lifestyle spending habits - such as socialising - on hold in order to purchase their first home, unit or apartment.
Many of those who wish to buy property in this time frame stated that their reason for doing so is to make a safe and secure investment over the long term.
However, 66 per cent of respondents stated that housing affordability is one of the biggest issues that they face when entering the property market as first time buyers.
This trend of younger buyers becoming savvier with property has been further supported with research from Mortgage Choice.
Mortgage Choice's 2013 First Time Property Investor Survey included over 1,000 Australians, with 34 per cent of them belonging to Generation Y (born between 1980 and 1994).
Furthermore, two-fifths of these Generation Y respondents stated that a rental property will be their very first home purchase.
"Gen Ys appear to be financially switched-on and are focusing on property investment, with 40 per cent of the respondents in this age bracket willing to forgo any available First Home Owner Grant on their first property purchase in favour of buying an investment property as opposed to a home," said Belinda Williamson, head of corporate affairs at Mortgage Choice.
"Meanwhile, the other 60 per cent of the Gen Y respondents already own their first or subsequent home and are now branching out to make an investment property purchase."
This category of respondents identified financial security as their main motivator for buying an investment property so that they can set themselves up for the future.
Similarly to the findings from the Co-Op research, affordability was cited as on the biggest issues with 42 per cent stating they would find it difficult to save a deposit.