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REIQ Journal : June 2008
38 INDUSTRY RESEARCH Angie Zigomanis, Senior Project Manager, BIS Shrapnel The profile of tenure also varies by age group. People aged 20-34 are the most likely demographic to be renting, and this has grown from 49.2 per cent of these households in 1991 to 52.9 per cent in 2006. On top of this, there is also an increasing proportion of 20-34 year olds who are still living in the family home. Given the further deterioration of affordability since 2006 due to higher interest rates and rising rents, it is likely this trend could have accelerated. The 35-49 year old cohort are most likely to be paying off a mortgage, and this has escalated in each Census from 1991 (42.9 per cent) though to 2006 (54.6 per cent). The majority of the 50-64 year old demographic fully own their property (48.2 per cent), although a large percentage were still paying off a mortgage in 2006 (33.6 per cent), while a smaller proportion were renting (18.2 per cent), according to the Census. The overwhelming majority of 65-plus year olds fully own their property (79.9 per cent), followed by those renting (14.9 per cent) and a small percentage are still paying off a mortgage (5.2 per cent), according to the ABS. The growth evolution of particular demographic groups has traditionally driven demand in Australia’s residential markets. The baby boomer generation (those born between 1946 and 1964) has underpinned population growth for half a century and is now approaching the retirement years. This generation, aged between 44 and 62, are at a stage where the rate of children leaving the family home increases, resulting in a growing number of empty nesters. With the leading edge of the baby boomer generation turning 65 in 2011, the retireeaged demographic will take over as the fastest growing cohort in the next five years. This transition will mark a shift in dwelling demand as baby boomers downsize their homes or consider moving into retirement accommodation. Between the 2001 and 2006 Census, there was an overall increase in the proportion of Australians aged 65 and over living in retirement or aged-care accommodation, according to the ABS. Most of this increase was concentrated in the demand for selfcare accommodation and nursing homes, while utilisation of cared accommodation decreased over the same period. Empty nester households and upgrader households historically favour separate houses, although a rising proportion are choosing medium and high density housing options. This group will be the increasing driver of demand for small dwellings in the future, particularly given the significant growth in the number of households. Those aged 20 to 34 and 65-plus have an increasing and greater propensity for living in medium and high density dwellings and will continue to drive demand for these dwellings. The growth evolution of particular demographic groups has traditionally driven demand in Australia’s residential markets. REIQ Journal June 2008