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Nine Out of Ten Australians Agree Property Prices are Becoming Unaffordable: Survey

Housing Affordability and sentiment Survey 2020-21
Published on April 20th, 2021
  Written by 
Adrian Edlington
Adrian Edlington is PR & Communications Manager at Savvy. With a keen interest in personal finance, car loans, the mortgage industry, cost of living pressures, electric vehicles and renewable technology, Adrian's research includes conducting primary data surveys and analysis of up-to-the-minute secondary Australian data sources. His work on behalf of Savvy has been featured on ABC.net.au The Conversation, the Sydney Morning Herald, AFR, News.com.au, The Age, Herald Sun, Adelaide Now, SBS On The Money, 7News, Car Expert, Which Car, Drive.com.au and more. In his spare time, Adrian enjoys mountain biking and business podcasts.
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   Commentary by 
Bill Tsouvalas

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Bill Tsouvalas
Bill Tsouvalas is the managing director and a key company spokesperson at Savvy. As a personal finance expert, he often shares his insights on a range of topics, being featured on leading news outlets including News Corp publications such as the Daily Telegraph and Herald Sun, Fairfax Media publications such as the Australian Financial Review, the Seven Network and more. Bill has over 15 years of experience working in the finance industry and founded Savvy in 2010 with a vision to provide affordable and accessible finance options to all Australians. He has built Savvy from a small asset finance brokerage into a financial comparison website which now attracts close to 2 million Aussies per year and was included in the BRW’s Fast 100 in 2015 as one of the fastest-growing companies in the country. He’s passionate about helping Australians make financially savvy decisions and reviews content across the brand to ensure its accuracy. You can follow Bill on LinkedIn.
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Australian housing affordability survey

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A recent survey conducted by Savvy has revealed 91.6% of Australians agree that property prices are becoming “unaffordable” in the current market.

  • 32.4% Cannot afford property as prices are too high
  • 26% believe foreign ownership is to blame
  • 37.1% of respondents who bought were concerned about being left behind
  • Two-thirds believe JobKeeper/Seeker stimulus is unlikely to have effect on prices

The survey polled 905 Australians about their attitudes and behaviours regarding housing affordability. 9.8% of those polled said they had purchased a property during the COVID-19 pandemic; 27.6% said they are considering buying within the next twelve months.

Almost a third of respondents (32.9%) are “very worried” that the current housing market is out of the reach of ordinary Australians. 39.3% said they “worried”, bringing the total of those concerned to almost three-quarters: 72.2%.

Main reason not to buy property 

The main reason respondents cited for holding off on buying is that they are still saving for a deposit (33.2%) followed by general housing unaffordability (32.4%). 14.6% of respondents said they were waiting to ride out the COVID-19 pandemic.

Top reasons why property market has become out of reach

This leaves many would-be home buyers in a double bind, as 28.6% say that they’re concerned if they don’t buy soon, they’ll be left behind.

When asked why property has become so out of reach, 26% cite foreign ownership as the reason, followed by record low interest rates (20.3%) and an oversaturated investment market (18.6%). 33.9% of people said that the end of JobKeeper/Seeker stimulus will force down prices, when asked if the measures had any impact on the real estate market.

Further, 29.8% said they were prepared to devote 20% of household income to home loan repayments; 25.7% said 30%; a staggering 20.6% said over 30%+.

Devoting over 30% of household income toward mortgage repayments is considered “mortgage stress” in the finance industry. 26.9% of those surveyed said they are currently experiencing mortgage stress.

Savvy Managing Director Bill Tsouvalas says that this should be cause for concern. “We’ve had a general feeling that the housing market is out of reach for Australians, but it seems that COVID-19 and other measures such as HomeBuilder and the First Home Buyer Deposit Scheme has still left most would-be home buyers worried if they don’t buy now, they’ll be shut out forever. The fact that almost a third of people are in mortgage stress is also alarming; it could be prelude to a much bigger correction.”

27% said they would save more of a deposit to secure their place in the property market; 23.7% said they’re waiting for a price crash. 21% are prepared to relocate in a regional or rural area.

Savvy - 2021 Property Affordability Survey - 2 (n = 905) 

Nationally representative survey of 905 adult Australians, aged 18 and over. Conducted by Octopus Group, on behalf of Savvy.

Completion date: 25/03/2021

Age groups:18-24, 25-34, 35-44, 45-54, 55-64, 65+

 

 

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Savvy is one of Australia’s largest online financial brokers, focusing on personal and commercial financial products. Founded in 2010, the firm has seen rapid growth, a testament to their provision of market leading rates and reaching customers with the latest in media and technology. Savvy is a proud supporter of Kids Under Cover, a charity assisting homeless and at-risk youth to strengthen their bonds to community and education. Savvy was named one of BRW’s fastest growing companies in 2015.

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