Millennials are often given a bad wrap. Why are you still living at home? You buy too many take out coffees! How self-entitled can you possibly be? Maybe if you spent less on Netflix you’d have saved for a housing deposit by now. Haven’t you had enough smashed avo yet?! And on and on it goes… When will this poor generation catch a break?
Well, if the current state of the property market is anything to go by, it probably won’t be anytime soon.
Bless their optimism…
Despite 83% of millennials having the intention to purchase their first home within the next five years, 64% believe that they would need to be earning far more than they currently are before they would be able to purchase any property. If that’s not sad enough, 69% say they are not in a financial position to even get a deposit for a home loan, and to top it all off, only 8% think they are likely to end up more financially fortunate than their parents.
Now, this certainly doesn’t scream “hooray for the future!”, but despite such depressing numbers for the up and coming generation, there is always a way to get around seemingly impossible odds.
What to do, what to do…
In our previous article, we painted a fairly bleak picture of the current status of Melbourne’s property market, which was riddled with unsettling statistics and was unfortunate enough to be given a cheery title with the words “Doom” & “Gloom”. So you get the idea. Melburnians aren’t super keen to invest in their own city at this point in time.
However, that’s not to say that there aren’t ways around this issue if, like the 83% of millennials racing to get into the property market, you’re wanting to make your move and wanting to make it in one of the most liveable cities in the world.
So what can be done? Well, let’s get savvy – something generation Y is known for- and figure out how to conquer this nasty, gen-Y-hating property market. This might just mean that the supposedly self-entitled millennials will have to compromise and possibly settle for a little less than perfection.
First thing’s first, remember your incentives! First home buyers in Victoria are entitled to receive $20,000 for any property up to $750,000 under the First Home Owner Grant scheme. So that’s something! That’s a lot of something.
Whether it’s the excessive number of frappacino lattes or just too much smashed avo, millennials are apparently going crazy for apartments. Research is showing that apartments are the first property of choice for gen Y. The new trend is seeing that the majority of millennials are snatching up apartments left, right, and center – with newly built, modern apartments close to public transport and often nearer the city center being at the top of the list.
As previously mentioned in our last article, apartment prices within Melbourne have managed to survive the devastating fall in housing prices nationwide. Given the ability of apartment prices to get through such a dramatic decline in value, this would indeed prove a perfect solution for millennials looking to invest all throughout Melbourne, since in some cases, absolutely no decline was found to hit apartment prices at all.
However, just by looking at the data, it seems as though millennials are already one step ahead and doing exactly that!
Despite popular belief, millennials are actually real go-getters, and have started using their trailblazing tendencies to revive and modernise older and cheaper suburbs in up and coming locations. Ok so, gentrification does of course have its downsides and again, millennials are often blamed for the upheaval of well-established suburbs. However, change is inevitable, and when individuals are being driven out of over-priced inner-city locations, the most logical and resourceful solution is to find the next best thing. Besides, much innovation and excellence can spring forth from change, and this exactly what we want to see.
Along the same road of apartment living, another trend that seems to be picking up quite rapidly is the Tiny House movement. Being.. well… tiny, these houses are incredibly cheap to build, very environmentally friendly, and especially cheap to live in given their adorable size. This has started to become an increasingly popular solution for a generation of first home buyers wanting to get into the property market in a far more affordable way, and who don’t see the need for an excessive amount of indoor space. Who needs 4 bedrooms and a living room fit to entertain a small country, am I right?
Bigger is Better
On the other hand, if space is something you feel that you just can’t live without, it might be worth your while to look into the Joint Ownership method, which is another trend that is quickly gaining momentum. The idea being that you and a bunch of your closest millennial buddies pool your financial resources and co-finance a mortgage – essentially sharing joint ownership of a property and starting your own little millennial community while you’re at it.
Alongside the obvious benefits this comes with in that it will save you a huge chunk of money, the dilemma of the fall in housing prices across Melbourne was not felt in the outer suburbs and the more regional areas where such joint ventures are most likely to occur. We should stress though, joint ownership requires an exceptionally high level of trust and transparency from all parties involved for it to be a success… we don’t want to se