Highlights
- Number of prospective first home buyers doubles from 7% in 2019 to 16% in 2020: Westpac Young First Home Buyers research
- Nearly 50 - 60% intend to move to suburbs with large Indian population
- Suburbs popular with Indian community are affordable, safe, have good infrastructure and places of worship
Homeownership incentives from the government, attractive interest rates and prevalent real estate market conditions have encouraged people, especially millennials, to come one step closer to owning their first home.
However, while taking this decision, a larger number of first home aspirants than ever before are gravitating towards suburbs which are already popular with Australia’s Indian community.
Twice as many first home buyers
Fifty-four per cent respondents of the Westpac research said they no longer want to pay rent. This appears to be the driving force behind the current season of first homeowner activity.
The number of first home buyers intending to enter the property market in the next five years has more than doubled from 7 per cent before the pandemic (2019) to 16 per cent in 2020. Experts predict this trend is likely to continue in 2021.
Westpac’s data reveals that in the aftermath of COVID-19, nearly half (48 per cent) of those surveyed are reconsidering the type of area they would like to live in. For the younger participants of this research, this number increased to 59 per cent.
According to the 2016 census data, most of Australia’s Indian population is concentrated in New South Wales and Victoria. Let's examine the trend in these two states.
While the data indicates popular areas based on their location and distance from the CBD, Westpac told SBS Punjabi that in Sydney, suburbs like Ashbury and Cammeray are highly sought-after whereas for Melbourne, Craigieburn and Croydon are gaining traction amongst prospective first home buyers.
New South Wales
Sydney-based Principal Solicitor at Amity Legal, Harshita Singh, says while a dominant portion of her clients hail from the Indian community, she sees a growing number of other community groups also showing interest in areas popular with Indian-Australians. She attributes this inclination to the affordability and infrastructure in these suburbs.
“First home buyers are usually young families who aspire to live in spacious houses with backyards, where their children can play and they can relax with friends and family. Such houses can be expensive, so people are attracted by suburbs where they can find a house under Sydney’s median price of $1 million,” says Ms Singh, who is also a conveyancer.
Harshita Singh specialises in property law. Source: Harshita Singh
According to the survey, the suburbs in NSW which are highly sought after are in the north and west. Ms Singh says she has a long list of clients enquiring for suburbs like Schofields, Riverstone and Blacktown.
“We receive around 40 enquiries every month for the above-mentioned areas from aspiring first home buyers, a large number of which are of Indian background. Another reason for their popularity is the proximity of gurdwaras and temples, which gives the residents a sense of belonging to their community and is especially pleasing for their parents when they visit from India,” says Ms Singh.
Westpac’s Managing Director of Mortgages, Anthony Hughes, said the research shows young Australians are increasingly seeking the independence and stability that homeownership provides despite the challenges brought about by the pandemic.
Melbourne's Craigieburn, with a Hindu (L) and a Sikh temple, is home to a large Indian community. Source: File photo
“It’s also interesting to see this is now largely being driven by Gen Z, many of whom might not have considered this a possibility prior to COVID-19. Even though younger generations have been highly financially impacted this year, it’s positive that many have really used this time to take stock of their finances and get serious about their long-term goals,” said Mr Hughes.
Victoria
Westpac’s respondents from Victoria who are planning to buy houses are inclined towards northern suburbs like Craigieburn and Croydon in the City's east.
Ashu Shukla, who recently purchased a plot in Craigieburn, says his decision hinged on several factors.
“As first home buyers from a young family, my wife and I were looking for an area that is affordable, less than 30 km from the CBD as we both work there, well-equipped and safe. There’s plenty of public transport available in Craigieburn and it is safe to move around even late into the night. Many of my Indian friends also look for these qualities while deciding on their first property,” he says.
Analysing the research data, Matt Hassan, Senior Economist, Westpac says it is “intriguing at the moment how active first home buyers are”.
Source: Getty Images/Inti St Clair
“We’ve seen an extraordinary surge in first home buyer activity over the last 18 months. You’re seeing this confluence of improved affordability – investors are so out of the market and you’re not getting outbid – and an attitudinal shift relating to the pandemic amongst prospective first home buyers. They’re now wanting to form their own household. I think lockdown wasn’t much fun for some of these people,” explains Mr Hassan.
Terry Singh, Director of Raine & Horne real estate agency at Melbourne’s Craigieburn, agrees with the findings of the Westpac survey.
“After Stage 4 lockdown in Melbourne, we have seen very a strong demand in these areas. The First Home Owner Grant, Homebuilder grant and historic low-interest rates have definitely contributed to the interest amongst those who want to buy their first house,” says Mr Singh, who is also a licensed auctioneer and often deals in high-value properties.
His colleague, Jas Bhandari, sees a lot of younger buyers with tighter budgets.
“In Melbourne's northern and eastern suburbs, first home buyers can think of using their savings to pay a deposit for a property close to Victoria’s median property value of $750,000. This ensures them of the zero stamp duty benefit from the Victoria government. Such customers are price-sensitive,” says Mr Bhandari.
Terry Singh (R) and Jas Bhandari of Raine & Horne real estate in Melbourne confirm a spike in interest in suburbs with a large Indian population. Source: Terry Singh
He adds that around 50 per cent of his monthly clients are first home aspirants, out of which around 25 per cent belong to the local Indian community.
“People want to live near their friends and family. This has led to a surge in demand and prices in the areas mentioned in the Westpac survey,” he adds.
The suburbs found popular by the survey rank high on infrastructure and distance from the CBD, estate agents and customers their concur.
“Craigieburn, for instance, where we work, has a great location with just a 15-minute drive to the airport. It has plenty of employment opportunities nearby, affordable property prices and all amenities, making it attractive for first home buyers,” says Mr Singh.
Listen to this podcast in Punjabi by clicking on the audio icon in the picture at the top of the page.
People in Australia must stay at least 1.5 metres away from others. Find out what restrictions are in place for your state or territory.
Testing for coronavirus is now widely available across Australia. If you are experiencing cold or flu symptoms, arrange a test by calling your doctor or contact the Coronavirus Health Information Hotline on 1800 020 080.
The federal government's coronavirus tracing app COVIDSafe is available for download from your phone's app store.
The federal government's coronavirus tracing app COVIDSafe is available for download from your phone's app store.
SBS is committed to informing Australia’s diverse communities about the latest COVID-19 developments. News and information is available in 63 languages at http://www.sbs.com.au/coronavirus
RELATED STORIES
Houses in Australia's capital cities become more affordable
