Gen Y are determined to save their pennies in a bid to make purchasing a home easier.
According to a new survey conducted by Loan Market Group, 84 per cent of 18-25 year old respondents and 78 per cent of those aged 25 to 40 wanted to prioritise savings this year.
Of the 598 people surveyed, the vast majority said they saw savings as the “gateway to qualifying for a home loan”.
“The survey results indicate that Gen Y are following the message that to pursue the dream of home ownership you need to save,” Loan Market chief operating officer Dean Rushton said.
“With changes to the banks' requirements for a higher percentage of genuine savings post-GFC, current potential first home buyers have to work harder on savings than their predecessors in the previous decade.”
Mr Rushton said encouraging people to be better disciplined when it comes to saving was a key to getting more first home buyers back in the market.
“First home buyers have dropped like flies since the boosted federal government grant to first home owners finished at the end of 2009,” he said.
“Our own enquiries from first time buyers fell 15 per cent in the second half of 2010 and reviving activity in the home finance market will depend on getting more people to enter the property market.”
The most recent ABS data shows in the last six months the proportion of first home buyers is at the lowest point it’s been at in the past five years, contributing to only 15.7 per cent of all dwelling purchases.
Mr Rushton said the federal government’s $1.2 billion First Home Saver Accounts (FHSA) scheme had done little to encourage more first time buyers into the market.
“The scheme has good intentions but the feedback from our network is that potential borrowers believe it lacks flexibility and the timeframe to lock in is too long,” he said.