Property Wealthy Weekly (March 25)

Property ownership in Australia confers significant benefits to individuals, particularly in retirement. However, a recent report by CoreLogic shows that the benefits are disproportionately enjoyed by more men than women. CoreLogic’s, “Women and Property: State of Play” report has highlighted that across Australia men had a higher rate of homeownership in January 2021 than women. Out of 4.8 million properties analysed by CoreLogic, men had exclusive ownership of 29.9% of the properties, compared to 26.6% owned exclusively by women. This is despite the fact that according to ABS data, women make up 50.9% of the population aged 18 and over.

CoreLogics’ data suggests that the key reason for the disparity in exclusive homeownership comes down to the gender gap in income. CoreLogic’s Eliza Owen notes that “Income is an important determinant of homeownership, and lower-income households in Australia consistently have lower rates of homeownership.” Data from the ABS shows that women on average earn 13.4% less than men, with men earning an average of $7,818 and women earning an average of $6,769 per month. This suggests that women are more likely to be in the lower-income brackets, and are therefore more likely to struggle to save the deposit or be able to make mortgage payments. On average men require 69 months to save a 20% deposit on the median dwelling value of $583,00, compared to 79 months for women. The 10 months difference in saving ability between genders creates a significant barrier to homeownership for women.

It is also important to note that women are over-represented in part-time employment statistics and fewer women are in full-time employment compared to men. Women accounted for 67.2% of part-time workers in Australia in January 2021, while only 37.9% of those in full-time employment are women. Women are more likely to work part-time due to parental and family responsibilities than men.

The data analysed by CoreLogic shows that 43.9% of properties are owned jointly by at least one man and one woman. This means that women have at least part ownership of 70.1% of properties, compared with 73.8% of properties being at least part-owned by men. With accessibility to financial resources regarded as the key determinant of property ownership, this implies that it is much easier for women to own property jointly. It also implies that ownership is far more attainable with two incomes.

The state with the highest portion of properties owned exclusively by women in Victoria, which 29.2% owned by women compared with 30.8% owned by men. This suggests that income disparity is at its lowest in Victoria, with less than 2 percentage points separating male and female homeownership rates.

The state with the lowest portion of properties owned exclusively by women in Western Australia, with just 22.9% of properties owned by women, compared with 29.6% owned by men. Interestingly Victoria had the lowest percentage of properties owned by a mix of men and women at 40%, whereas Western Australia had the highest percentage at 47.5%. The figures from Western Australia also show that it takes 14 months longer for women to save for a deposit than men. According to Eliza Owens, the gap in both homeownership and ability to save for a deposit in Western Australia is due to the fact that “higher incomes have generally been earned across male-dominated sectors such as mining.”

However, there are seven regions in Australia where women actually own more properties than men. The region with the biggest percentage of properties owned exclusively by females is in the Eastern Suburbs of Sydney, where 34.8% of properties are owned exclusively by women compared with 31.7% owned by men.

The region with higher female ownership compared with male ownership with the biggest gap is the Inner South region of Melbourne, where 32.6% of the property is exclusively owned by females, compared with 27.6% of properties owned by males and 39.9% owned by males and females.

One explanation for the higher female ownership in these seven regions is that they tend to be higher-income regions, and women on higher incomes tend to have a greater propensity to buy property, sometimes even outpacing property ownership rates of male. Another possibility for the higher female ownership in these regions is that they also tend to be regions with a higher proportion of high-density dwellings such as apartments, and some research has suggested that female ownership of property is higher in apartments than in houses.

The report by CoreLogic highlights that there appears to be a greater barrier to property ownership for women than for men, with the gender pay gap one of the key reasons. Property ownership in Australia is considered a key pillar of financial stability, particularly in retirement. Figures from the Reserve Bank of Australia suggest that the value of housing accounts for 52.6% of household wealth in Australia. Not only is property ownership a key pillar of financial stability in retirement for individual households, but it also provides significant wider society benefits, by complementing the broader development of self-provision in retirement and reducing pressure on public financing of retirement pensions. Further homeowners often invest time and money within their local communities, thereby strengthening local communities.

Given the advantages of homeownership on both an individual and societal level, it would be advantageous for the barriers to homeownership for women to be reduced. The CoreLogic report notes that a long term policy to address the gender pay gap would help to reduce these barriers.

If you want to see how property investment can work to reduce the gender wealth gap, request a specialised 1:1 strategy session with one of our Senior Property Coaches today.

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HOUSING MARKET TIPPED TO POWER ON DESPITE END OF JOBKEEPER: ECONOMISTS

The property market is set to roll on full steam ahead despite economic support measures coming to an end from this week, defying long-held worries about a looming fiscal cliff, according to top economists.

The strength of bricks and mortar barely crumbled during the pandemic-induced recession, with property prices edging lower briefly then soaring in major cities and regional towns – flying in the face of forecasts.

At the height of the crisis last year, housing price drops of 10 to 20 per cent were predicted amid fears of a fiscal cliff in September when income support measures were due to end.

But that never happened. Instead of turning off overnight, income support measures were extended for another six months with tapered payments from October.

Full Article Here.

WHAT IMPACT WILL A FALLING POPULATION HAVE ON AUSSIE HOUSE PRICES?

Property markets are hot. I was at an auction the other day where the place sold for $375,000 over the top of the advertised range.

Aussies are making the most of very low interest rates and buying houses in a frenzy. This is driving up prices across the country, as the next graph shows.

If you, like me, thought COVID would depress the market, nope. Bizarrely, the city with the fastest house price growth – Melbourne – is also the one with the most empty homes.

As the next graph shows, Melbourne has the country’s worst rental vacancy rate. 28,000 rental properties sit vacant – which is more than Sydney and over 4 per cent of all rentals in Melbourne.

And yet house prices are rocketing.

Full Article Here.

7 PROPERTY TRENDS WE CAN EXPECT TO SEE IN 2021

It seems we are in for a wild ride in our property markets in 2021.

But if history has taught me anything, it is that there will be hit by an unexpected X factor coming out of the blue to undo the most reasoned property forecasts, either on the upside or the downside, however here are seven property trends I expect to happen in 2021

1. Property demand from home buyers is going to continue to be strong

Currently home prices are surging around Australia, auction clearance rates remain high, and the media keeps reminding us we’re in a property boom.

The result is emotions are running high at the moment, with FOMO (fear of missing out) being a common theme around Australia’s property markets.

One of the leading indicators I watch carefully is finance housing approvals, and these are at record levels suggesting that more Aussies are looking at getting into property and we will have strong ongoing demand from owner occupiers and investors as the year moves on.

It’s clear that we are now over the “recession we made ourselves have”, 93 per cent of the jobs that disappeared during Covid have returned and consumer and businesses confidence is rising.

Full Article Here.

WHY DO WOMEN OWN FEWER PROPERTIES THAN MEN?

Property ownership in Australia confers significant benefits to individuals, particularly in retirement. However, a recent report by CoreLogic shows that the benefits are disproportionately enjoyed by more men than women. CoreLogic’s, “Women and Property: State of Play” report has highlighted that across Australia men had a higher rate of homeownership in January 2021 than women. Out of 4.8 million properties analysed by CoreLogic, men had exclusive ownership of 29.9% of the properties, compared to 26.6% owned exclusively by women. This is despite the fact that according to ABS data, women make up 50.9% of the population aged 18 and over.

CoreLogics’ data suggests that the key reason for the disparity in exclusive homeownership comes down to the gender gap in income. CoreLogic’s Eliza Owen notes that “Income is an important determinant of homeownership, and lower-income households in Australia consistently have lower rates of homeownership.” Data from the ABS shows that women on average earn 13.4% less than men, with men earning an average of $7,818 and women earning an average of $6,769 per month. This suggests that women are more likely to be in the lower-income brackets, and are therefore more likely to struggle to save the deposit or be able to make mortgage payments. On average men require 69 months to save a 20% deposit on the median dwelling value of $583,00, compared to 79 months for women. The 10 months difference in saving ability between genders creates a significant barrier to homeownership for women.

It is also important to note that women are over-represented in part-time employment statistics and fewer women are in full-time employment compared to men. Women accounted for 67.2% of part-time workers in Australia in January 2021, while only 37.9% of those in full-time employment are women. Women are more likely to work part-time due to parental and family responsibilities than men.

The data analysed by CoreLogic shows that 43.9% of properties are owned jointly by at least one man and one woman. This means that women have at least part ownership of 70.1% of properties, compared with 73.8% of properties being at least part-owned by men. With accessibility to financial resources regarded as the key determinant of property ownership, this implies that it is much easier for women to own property jointly. It also implies that ownership is far more attainable with two incomes.

The state with the highest portion of properties owned exclusively by women in Victoria, which 29.2% owned by women compared with 30.8% owned by men. This suggests that income disparity is at its lowest in Victoria, with less than 2 percentage points separating male and female homeownership rates.

The state with the lowest portion of properties owned exclusively by women in Western Australia, with just 22.9% of properties owned by women, compared with 29.6% owned by men. Interestingly Victoria had the lowest percentage of properties owned by a mix of men and women at 40%, whereas Western Australia had the highest percentage at 47.5%. The figures from Western Australia also show that it takes 14 months longer for women to save for a deposit than men. According to Eliza Owens, the gap in both homeownership and ability to save for a deposit in Western Australia is due to the fact that “higher incomes have generally been earned across male-dominated sectors such as mining.”

However, there are seven regions in Australia where women actually own more properties than men. The region with the biggest percentage of properties owned exclusively by females is in the Eastern Suburbs of Sydney, where 34.8% of properties are owned exclusively by women compared with 31.7% owned by men.

The region with higher female ownership compared with male ownership with the biggest gap is the Inner South region of Melbourne, where 32.6% of the property is exclusively owned by females, compared with 27.6% of properties owned by males and 39.9% owned by males and females.

One explanation for the higher female ownership in these seven regions is that they tend to be higher-income regions, and women on higher incomes tend to have a greater propensity to buy property, sometimes even outpacing property ownership rates of male. Another possibility for the higher female ownership in these regions is that they also tend to be regions with a higher proportion of high-density dwellings such as apartments, and some research has suggested that female ownership of property is higher in apartments than in houses.

The report by CoreLogic highlights that there appears to be a greater barrier to property ownership for women than for men, with the gender pay gap one of the key reasons. Property ownership in Australia is considered a key pillar of financial stability, particularly in retirement. Figures from the Reserve Bank of Australia suggest that the value of housing accounts for 52.6% of household wealth in Australia. Not only is property ownership a key pillar of financial stability in retirement for individual households, but it also provides significant wider society benefits, by complementing the broader development of self-provision in retirement and reducing pressure on public financing of retirement pensions. Further homeowners often invest time and money within their local communities, thereby strengthening local communities.

Given the advantages of homeownership on both an individual and societal level, it would be advantageous for the barriers to homeownership for women to be reduced. The CoreLogic report notes that a long term policy to address the gender pay gap would help to reduce these barriers.

If you want to see how property investment can work to reduce the gender wealth gap, request a specialised 1:1 strategy session with one of our Senior Property Coaches today.

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WEEKLY ARTICLES

HOUSING MARKET TIPPED TO POWER ON DESPITE END OF JOBKEEPER: ECONOMISTS

The property market is set to roll on full steam ahead despite economic support measures coming to an end from this week, defying long-held worries about a looming fiscal cliff, according to top economists.

The strength of bricks and mortar barely crumbled during the pandemic-induced recession, with property prices edging lower briefly then soaring in major cities and regional towns – flying in the face of forecasts.

At the height of the crisis last year, housing price drops of 10 to 20 per cent were predicted amid fears of a fiscal cliff in September when income support measures were due to end.

But that never happened. Instead of turning off overnight, income support measures were extended for another six months with tapered payments from October.

WHAT IMPACT WILL A FALLING POPULATION HAVE ON AUSSIE HOUSE PRICES?

Property markets are hot. I was at an auction the other day where the place sold for $375,000 over the top of the advertised range.

Aussies are making the most of very low interest rates and buying houses in a frenzy. This is driving up prices across the country, as the next graph shows.

If you, like me, thought COVID would depress the market, nope. Bizarrely, the city with the fastest house price growth – Melbourne – is also the one with the most empty homes.

As the next graph shows, Melbourne has the country’s worst rental vacancy rate. 28,000 rental properties sit vacant – which is more than Sydney and over 4 per cent of all rentals in Melbourne.

And yet house prices are rocketing.

7 PROPERTY TRENDS WE CAN EXPECT TO SEE IN 2021

It seems we are in for a wild ride in our property markets in 2021.

But if history has taught me anything, it is that there will be hit by an unexpected X factor coming out of the blue to undo the most reasoned property forecasts, either on the upside or the downside, however here are seven property trends I expect to happen in 2021

1. Property demand from home buyers is going to continue to be strong

Currently home prices are surging around Australia, auction clearance rates remain high, and the media keeps reminding us we’re in a property boom.

The result is emotions are running high at the moment, with FOMO (fear of missing out) being a common theme around Australia’s property markets.

One of the leading indicators I watch carefully is finance housing approvals, and these are at record levels suggesting that more Aussies are looking at getting into property and we will have strong ongoing demand from owner occupiers and investors as the year moves on.

It’s clear that we are now over the “recession we made ourselves have”, 93 per cent of the jobs that disappeared during Covid have returned and consumer and businesses confidence is rising.

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