The history of the Aussie home buyer – are we really any better off now?

The history of the Aussie home buyer – are we really any better off now?

The dream of owning our own home seems to be as Australian as Vegemite. Since the first settlers arrived in Australia we have been sold the dream of home ownership.

I was speaking to a number of good friends this week. I found it interesting to listen to their thoughts on owning their own homes and investing in property. I noticed that all of my friends wanted to buy a property and could see them selves owning their own home in the future. I also noticed that they all put far to much value on property ownership and saw it as expensive, overwhelming and a challenge their future self would have to meet one day.

What I realised is that many first homebuyers, like my friends, believe its more difficult to buy a home today, than it was in the past.

I question if this really the case?

Interest Rates

Today, interest rates are currently hovering around historical lows. The official cash rate is sitting at just 2.5% and while this rate will more than likely increase over the coming months, right now, borrowing is significantly easier and cheaper than it was 5 to 10 years ago.

House Prices

There are many people who talk about the Aussie housing bubble. There are commentators who look at Australia as the next speculative market set to burst as foreign and domestic demand pushes prices up.

That said, there are others who believe that property buyers have never had a better time to purchase.

According to ANZ, the purchasing power of Australians is significantly better than actual house prices. Furthermore, TD Securities believe we are not in a housing bubble, as house prices and housing credit are at historic lows, which is not indicative of a house price bubble.

What makes the Australian market so interesting is its variety. Unfortunately many of us get caught in the trap of viewing it as a single market. To really understand the Australian market you have to look into each state, region, suburb and street. There are regions all over Australia where prices are over inflated and others that are undervalued, the Sydney market is a great example of this.

It’s important to remain positive and be patient. First home buyers need to remember buying a house is a long-term investment, so waiting for the right time to strike is very important.

According to CommSec the portion of home loans be granted to first-home buyers has sunk to record lows.

Cause for optimism?

The future of Australian Home ownership is still bright. The preconception that it’s hard, expensive or near impossible to get into the market are completely untrue.

At the end of the day, it is important to remember that finding the right home, the right lender and saving the necessary deposit is a time consuming task and one that cannot be taken lightly. The key is to remain positive, be smart and know the Australian dream is still alive.

Had I written this article before I spoke to my friends this week I would of told them property ownership has never been more affordable when looking at interest rates and repayments as a percentage of wages.

For the majority of young people the issue isn’t really affordability, although thats what the media focuses on. The elephant in the room may be that generation Y see them selves differently than those who have gone before and property ownership just isn’t as important anymore.

I personally think its got more to do with a culture of instant gratification and over spending than anything else. For many of us starting from the bottom it can be painful saving for a deposit, feeling confident enough to buy a property and putting it all on the line to change our future.

Three and a half years down the property investment track, I can honestly say its worth the short term pain.

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The information provided in this article is of a general nature only and in no way constitutes legal or professional advice, or specific advice in relation to any finance. In all cases we recommend you receive professional financial advice for your own personal circumstances. 



Ben Everingham


Ben founded Pumped On Property after building a multi-million dollar property portfolio over a 5 year period. His mission is to show you how to replace your income through property investing so you can do what you love…full time.