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Optimism has been growing among Gen Z home buyers despite facing significant financial hurdles, with one in three planning to buy a property in the next few years.
New data showed that confidence among Gen Z home buyers has surged this year, with more young individuals aiming to buy their first property in the next five years.
A Westpac report found that more than one in three (35 per cent) Gen Z Australians plan to buy their first home within five years, up by five per cent since January 2025.
According to the Home Ownership Report, younger Australians have been doubling down on their bid to own a home, with 37 per cent fuelled by a desire for independence, and 34 per cent of buyers motivated by financial security.
Rent also contributed to 32 per cent of Gen Z buyers’ reasons for wanting to buy a home, with young Australians daunted by the idea of renting forever.
However, in contrast, the option to rent-vest has maintained its popularity since January, with more than half of Gen Z buyers, 55 per cent, still considering the strategy.
McGrath Parramatta sales agent Sam Dalgliesh said he has seen many Gen Z buyers remain determined to purchase their own homes despite high interest rates in recent years.
“It's primarily that they want to get into the market; the rents are going up, so they may as well be servicing their own loan,” he told REB.
“So it's not really, we'll put it on hold. It's more of they've got to, regardless of those external things that they're still looking at, getting into the market.”
The report also found that a drive to buy sooner meant there was increased flexibility among younger Australians, with 80 per cent being open to purchasing in suburbs they hadn’t previously considered.
Gen Z buyers have also compromised on property types, with interest in buying a house falling by three per cent since January, while plans to purchase an apartment have increased by two per cent.
Dalgliesh said many Gen Z buyers were not only shopping around different locations, but also resorting to purchasing apartments after being priced out of the housing market.
“Quite often they might be able to get a better location with an apartment than, obviously, if they were looking for a house they couldn't afford.”
“It allows them to live more so in the suburbs that suit them a little bit more, whether that's for work or whether where they want to reside, it's close to family or whatever.”
He said there has been a recent shift in the volume of apartment inspections, with 10 to 15 individuals viewing apartments within the first week on market, whereas there would usually be the same number of viewers within a month.
“A lot of them have decided, well look, we may as well be servicing our own mortgage and get into the marketplace, and there are obviously those government incentives as well,” he said.
“So we're not noticing a dramatic increase in prices, but we're just noticing that the volume of buyers coming through is a little bit better than what it has been in the past, and we're probably able to sell [apartments] a little bit quicker.
Additionally, the data showed 80 per cent of first home buyers in general have been making active lifestyle changes to boost their savings, such as cutting back on non-essentials like food delivery.
Despite their determination, the financial challenges of affording a home persisted, with nearly a third of all first-home buyers targeting deposits of ten per cent.
Comparatively, out of the Gen Z cohort, 53 per cent of buyers have aimed for a deposit of 10 per cent or less of the purchase price.
Dalgliesh said that, in trying to afford a deposit, he has seen the younger generation be extremely reliant on family for both advice and financial aid.
“A lot of them are bringing parents through and getting their advice and their support .. whether they're contributing financially or not, maybe not at all or maybe a little bit or maybe a lot.”
“So we are seeing a little bit of that – they're very much leaning on that support network before they make decisions,” he concluded.
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