Young Australians and the Housing Gap

This report investigates short and longer term housing aspirations and the housing aspirations gap among young emerging (18–24 years) and early adults (25–34 years).

Based on the ABS Survey of Income and Housing (SIH), the share of emerging young adults living with parents increased from 58 per cent to 66 per cent between 2003–04 and 2015–16. At the same time, the share of early adults living with parents increased from 14 per cent to 20 per cent while early adults in group households increased from 11 per cent to 13 per cent.
From the AHA survey the majority of emerging adults identify owner-occupation (60%) as their ideal. Fifty-four per cent aspire to live in a house and 34 per cent in an apartment. Around 32 per cent want four or more bedrooms compared to 30 per cent wanting one or two.
Few emerging adults are actively planning for their housing futures with housing aspirations, for most, remaining secondary to pursuing education and employment goals (AHA).
For early adults, the aspiration for owner-occupation increases to 70 per cent, but by this stage the income and education divide in being able to meet such aspirations becomes starker, with far greater proportions of degree-educated households being confident they can obtain ownership within five years compared to those educated to year 12 and below (AHA).
Sixty-eight per cent of early adults aspire to live in a house compared to 21 per cent in an apartment and over 43 per cent want four or more bedrooms compared to 22 per cent wanting one or two (AHA).
The housing aspirations gap in early adulthood is greatest for those in the private rental sector, particularly those on higher incomes, and narrowest for those in home ownership, regardless of income (AHA).
Across both age groups, having somewhere safe and secure to call home was the top priority (AHA).
The goal of policy makers should be to enable young people to move towards secure independence through a tenure neutral mix of housing assistance. This includes the key policy platforms of pursuing, and living near, opportunities for study and work; balancing flexibility with security within the dwelling and community; providing diversity and real choice in dwelling type, size and location; and helping households move towards independence and longer term financial freedom and security in owning or renting.

AHURI Final Report No.318 2 – The challenges young adults now face in the move towards independent housing have been well rehearsed and debated across popular media, policy and academic forums for some time. This report, part of a larger Inquiry into the housing aspirations and constraints for lower income Australians, delivers a contemporary evidence base about the housing aspirations of young adults (18–34 years), in order to better understand how their aspirations are linked to a ‘broader life project’ across areas such as education, employment and family formation.

This current study uses the dual concepts of ‘housing aspirations’ and ‘housing aspirations gap’, which refer respectively to the housing that young adults aspire to in the short and longer term, as well as to the space between young adults’ aspirations for an ideal home and the objective constraints in its attainment. We focus on how short and longer-term aspirations differ among young adults in emerging adulthood (18–24 years) and early adulthood (25–34 years). The objective of this research is to inform policy responses that address the challenges associated with meeting the housing aspirations of the next generation of young adults.

We address here three research questions:

What are the shelter and non-shelter aspirations of lower income young Australian adults at emerging and early adulthood?
Where lower income young adults are unable to achieve their housing aspirations, what is the nature of their ‘housing aspirations gap’ and how does this vary across socio-economic status, tenure and location?
What current and innovative housing policy solutions should be implemented to assist young adults to meet their short and longer term housing aspirations?

Read Executive Summary here …

Read the full report here …