Millennials will shape our housing markets over the next decade
4 min read
Key takeaways
Demographics will always drive our property markets and because of their sheer size and stage in the life cycle, no generation will shape Australia more during the coming decade than millennials.
Millennials, born between 1982 and 1999 are now aged 21 to 38, and they will be 31 to 48 by 2030.
As they move into the family formation stage of their lives they’ll want more space, an additional bedroom or two to bring up their kids and the ability to work from home – at least occasionally.
As a property investor, it’s important to understand how changing demographics will alter the requirement for housing moving forward.
Demographics will always drive our property markets and because of their sheer size and stage in the life cycle, no generation will shape Australia more during the coming decade than millennials.
According to leading demographer Simon Kuestenmacher, throughout the 2020s this generation of what he calls procrastinators will follow in the footsteps of every generation before them and enter the family formation and home-buying stage.
Writing in the Australian, Kuestenmacher says millennials will leave their centrally located one or two-bedroom apartments and migrate to the suburbs or even regional centres in search of more bedrooms.
Millennials, born between 1982 and 1999 are now aged 21 to 38, and they will be 31 to 48 by 2030.
As they move into the family formation stage of their lives they’ll want more space, an additional bedroom or two to bring up their kids and the ability to work from home – at least occasionally.
There is little doubt that millennial knowledge workers will be working from home much more regularly in the future.
They will also value their neighbourhood – wanting to live in a “20-minute neighbourhood” where everything is within a short walk drive or cycle from their home.
As millennials move into the suburbs, who will move into the inner-city apartments left behind?
You’d think it would be Gen Z.
The problem is that the Zs, who should take their place is a much smaller generation than the millennials and, with lower migration intake because of the coronavirus during the next few years, inner-city properties will stagnate or fall in value.
As a property investor, it’s important to understand how changing demographics will alter the requirement for housing moving forward.
And it will be equally important to own the type of property that will be in continuous strong demand by affluent owner-occupiers.
This will not only push up the value of your property but will ensure that you obtain tenants who are more affluent and renting for lifestyle reasons rather than because they can’t afford to own properties.
Having the right type of tenant will ensure your rental income will increase over time.
