LENGTH OF HOME OWNERSHIP CONTINUES TO RISE
The latest data to May 2019 shows that home owners are holding onto their property for much longer than they were 10 to 15 years ago. The average hold period has consistently increased since 2005 across both house and units nationally. The average hold period figure is based on sales from the past year, using the latest sold date and the previous sold date to establish how many years a property has been held for between each transaction. Nationally, the average length of home ownership currently sits at 11.3 years for houses and 9.6 years for units, this is an increase of 3.8 years for houses and 2.9 years for units over the past 10 years.
Across the individual capital cities, the average hold period of both houses and units has risen over the last 10 years, 5 years and year, with houses on average being held longer relative to units across all capital cities. Over the last year, houses in Melbourne recorded the longest period of ownership at an average of 12.5 years, while Perth came in with the longest average hold period of 10.8 years for units. At the opposite end of the spectrum, houses in Darwin are typically being held for 9.2 years and Canberra units on average 8.7 years; the shortest average hold period across the capital cities.
Compared to ten years ago, Sydney recorded the longest average hold periods for both houses and units at 9 and 7.3 years respectively, since then Melbourne houses have consistently seen the longest hold period, while results have been varied across the unit market.
Regional Victoria and Queensland represented the areas with the longest average hold periods across regional Australia, with houses across both regions currently being held on average 11.1 years, while units in regional WA are being held the longest at 10.2 years. The Northern Territory rest of state region currently has the shortest average hold period at 8.9 years for houses and 8 years for units.
Looking at the council areas with the longest average hold period, the list for houses is dominated by regions within Melbourne, Sydney and regional Queensland. Houses in Monash Victoria came in with the longest average hold period at 17.1 years. While for units, Perth makes up eight of the 20 council regions with the longest hold periods. Armadale (WA) and Swan Hill (Vic) both recorded an equal average hold period of 13.4 years for units.
The East Pilbara council region tops both the house and unit list for the shortest average hold period, with houses currently being held for 7.7 years, while units across the region are being held by half the duration at 3.8 years. The remaining regions on the house list are comprised by mostly regional parts of the country as home owners are evidently more likely to sell across these regions compared to their capital city counterpart. Interestingly however, the shortest average hold period list for units is dominated by Melbourne with 6 of the 20 council regions making up the unit list.
The data suggest that home owners are much more reluctant to sell their property than they were a decade ago which is also highlighted by the ongoing decline in sales transactions. Other factors such as the rising cost of selling and purchasing property, combined with affordability constraints across some Australia’s more expensive capital cities contribute to owners holding onto their properties longer. It’s expected that this trend will continue over the coming years given such concerns aren’t likely to see much improvement in the near future.
5 Sep 2019
Source - https://www.corelogic.com.au/news/length-home-ownership-continues-rise?utm_source=newsletter&utm_medium=email&utm_campaign=pp_20190909&utm_content=pp_blog