THE outlook for first homebuyers is not encouraging as hidden households are causing problems - news.com.au
ANZ senior economist Daniel Gradwell argues in an article published in news.com.au that Australia’s housing balance has been “distorted” by affordability issues.
He points out that the problem is what’s known as the “headship ratio” which has steadily fallen since 2011, particularly among 20- to 34-year-olds.
He explains the reason for the steadily fall in the headship ratio is that younger buyers are waiting longer to form new households, which “artificially” lowers demand for housing. In other words, he says, it’s a Catch-22 — were prices to come back to more reasonable levels, these hidden households would emerge from the woodwork and gobble up supply.
According to news.com.au, ANZ found that if headship ratios were sustained at their 2011 levels, the added demand for dwellings would imply a “much larger shortage” at a national level.
“The outlook for FHBs is not encouraging,” Mr Gradwell writes. “The probability of strong population growth and the presence of many potential FHBs mean the market is likely to remain extremely competitive.
