1301.0 - Year Book Australia, 2012
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 24/05/2012
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Statistics contained in the Year Book are the most recent available at the time of preparation. In many cases, the ABS website and the websites of other organisations provide access to more recent data. Each Year Book table or graph and the bibliography at the end of each chapter provides hyperlinks to the most up to date data release where available.
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HOUSING AND LIFE CYCLE STAGES
As people progress through different life cycle stages and their family structures and financial situations change, so do their housing needs and preferences. For young people leaving their parental home, a typical life experience with housing might begin with renting a small flat or unit for themselves or sharing a group house, then moving on to renting an apartment or house with their partner while saving for a deposit on their first home. Many couples will buy their first home and pay off a considerable part of their mortgage before having their first child.
As the number and age of children increase, many families will upgrade to a larger house. After the children have left home, most home owners will probably remain in the same home at least until retirement, by which time most will own their home outright. After retirement, some will change location, and in doing so a few will choose a smaller home, possibly a unit in a retirement village. Later, some who are too old or frail to live in their own home will move into cared accommodation (see Residential aged care in the HOUSING ASSISTANCE section).
While most Australians aspire to own their home outright, at least by the time they retire, many on low incomes cannot afford to buy a home and some cannot afford to rent adequate housing. There is a range of government programs aimed at assisting low income households to buy or rent suitable and affordable housing (see HOUSING ASSISTANCE).
In 2009–10, almost half of young (reference person aged under 35 years) couple only households, and over half of young couples with dependent children, owned their own home (49% and 55% respectively) (graph 10.20 and table 10.22). The home ownership rate was considerably lower for young lone person households (35%). Home ownership rates generally increased with age of reference person.
In 2009–10, one parent families with dependent children had the lowest home ownership rate (40%) and the highest proportion of renters, particularly public renters, with 13% of such households renting from a state or territory housing authority and 43% renting privately (table 10.24). Lone person households also had relatively high proportions of renters, with 7% renting from a state or territory housing authority and 27% renting privately.
For all age groups, lone person and couple only households were more likely to have one or more spare bedrooms than couple families with children (graph 10.21). In 2009–10, 87% of lone person households and 98% of couple only households had one or more spare bedrooms, compared with 68% of couple families with children (table 10.22).
number of
households
of persons in household
of bedrooms in dwelling
more spare bedrooms(b)
house
flat/ unit/
apartment
owner
** estimate has a relative standard error greater than 50% and is considered too unreliable for general use
There are long-term benefits in home ownership. Initially, the cost of home purchase is often far greater than the cost of renting (due to the costs of deposits and fees, as well as ongoing mortgage repayments). However, the much lower costs associated with owning a home outright, and the investment that a home represents, can be major contributors to economic wellbeing, particularly for older people, who may retire on considerably reduced incomes.
In 2009–10, the average weekly housing costs of young households with a mortgage was $470 – 46% more than the average weekly rent of young private renters (graph 10.23). However, the difference in housing costs between owners with a mortgage and private renters was less for older age groups, reflecting the former's lower mortgage payments.
The difference in housing costs between younger and older owners with a mortgage is largely a reflection of the difference in house prices, and hence the amount borrowed, at the time of purchase. On average, recent home buyers paid higher prices than those who bought their homes ten or more years ago. In 2009–10, about 60% of young households (reference person aged under 35 years) with a mortgage were recent home buyers compared with 4% of the oldest home owners (reference person aged 65 years and over) with a mortgage (table 10.24). The average mortgage outstanding for young home owners was $255,443 compared with $74,761 for the oldest.
In 2009–10, average weekly housing costs were highest for young households (reference person aged under 35 years) renting privately at $321, declining with age to $204 for households with a reference person aged 65 years and over. This pattern largely reflects the need for larger households to rent larger, and often more expensive, dwellings. In 2009–10, couple families with dependent children represented 39% of young private renter households, 20% of those with a reference person aged 35–44 years and 10% of those with a reference person aged 45–54 years.
Average weekly rents paid by public renters were less than half those of private renters, starting at $136 for younger households and declining to $95 for the oldest. Owners without a mortgage had by far the lowest and least variable housing costs, averaging $35 per week overall.
as a proportion of gross
household income(b)
of mortgage outstanding(c)
a mortgage
a mortgage
state/territory housing authority
private
landlord
Much of the variation in housing costs between households at different life cycle stages is related to differences in tenure patterns. For example, in 2009–10, households with a reference person aged 35–44 years had the highest average weekly housing costs ($352), as well as the highest proportion of owners with a mortgage (54%) and the second highest average amount of mortgage outstanding ($232,800).
Older households (with a reference person aged 65 years and over) had the highest proportion of home owners without a mortgage (78%), and whilst having the lowest proportion of private renters (6%), had the highest proportion of public renters (5%). Together, these factors resulted in this group having the lowest average weekly housing costs ($56).
Consistent with housing costs, the proportion of household income spent on housing declines with age, but to a lesser extent. For example, in 2009–10, the oldest lone person households paid an average of $48 per week (10% of their gross household income) for housing, while the youngest lone person household paid $285 (25% of their gross household income) for housing.