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Challenges and tips for Gen Z’s entering the property market

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Gen Z (that is, those born between 1997 and 2012) are fast taking over as the largest consumer group, following hot on the tail of the millennial group. But as this group starts flying the coop, they’re faced with the daunting reality, that entering the property market might not be quite as feasible as they’d hoped.  


Obstacles faced by Gen Z

While it’s forgivable to assume that the Gen Z group has it easier in many ways, there are definitely some major challenges faced by this group that their predecessors didn’t have to deal with in the same way.  


  • HECS-HELP debt

For those who have recently graduated, student loan debts (or HECS-HELP debts) need to be paid back. Though graduates aren’t expected to pay the tens of thousands back in one lump sum payment, compulsory repayments are to be made once the individual earns an annual amount above the threshold – and for the 2022-23 income year, this amount is $48,361. 

With full-time entry-level retail workers earning on average $54,550 per year, this surely means that every single graduate who enters into full-time work in their field of study will pay a significant amount of their fortnightly earnings towards a student debt. This alone is a major contributor to Gen Z having to delay their eventual property purchase!

  • Inflation and rent

I’m seeing a lot of young singles opting to remain in the family home until they’re financially able to place a deposit on a home of their own – even if it means sticking with mum and dad into their late twenties/early thirties. 

With the pressure of student loans to repay, the ever-rising cost of living and the discrepancy between supply and demand on the rental market right now, this is a decision that makes sense. In other cases, friends and even couples are opting to live together to save a few dollars that will help them save for their dream home in the future (you can read more about this here: Buying with friends: is taking out a mortgage with mates worth it?)


Tips for Gen Z to enter the property market

Despite some of the setbacks Gen Z buyers may be facing, this is actually a really exciting time to be dipping your toe into the waters when it comes to property purchase. So here are some solid tips to keep in mind when you or your Gen Z loved one is ready to embark on their house buying journey. 

  • Keep your debts in mind

When it comes to your student debts, it may be best to knock out a few years in the workforce to help whittle away the pressure of this huge debt before you take on a mortgage. 

Remember, you’ll also want to ‘live’ a little at times and maintain a lifestyle that makes you happy. If 100% of your salary is put towards your HECS-HELP debt, a mortgage and any other debts you might have incurred along the way (including a car loan or credit card), there’ll be no ‘play money’ left to enjoy – or money to fall back on if interest rates rise, or your property requires significant maintenance. 

  • Set clear goals

Before you decide to buy, take the time to think carefully about where you want to live, the type of property you see yourself living in, how long you want to stay there, how you will commute to work, whether the area has all the amenities you need and even the perks you would love. 

It is more costly to buy the wrong property and deal with the repercussions over time, than it is to wait it out for the right property that ticks all your boxes. 

  • Widen your search

It’s likely you’ve looked at the house prices recently and thought “there’s no way I can afford my dream home!” This is exactly why I suggest expanding your search. 

Open yourself up to the idea of living in a nearby suburb – one that still meets your needs, but comes with a cheaper price tag. Or if you’re a single and “dreaming big” with the idea of a 5-bedroom house in the suburbs, big enough for your mates to come stay at the weekends, you might consider starting smaller (2-3 bedroom home, or even a 2-bedroom apartment), paying off a smaller mortgage now and investing in a larger property in the years to come. 


Are you a Gen Z buyer or someone helping a Gen Z-er to find their first home? Then Kitty & Miles is the property buying agency for you! Our team of friendly buyers and auction snipers will make your homebuying adventure as simple as possible. Whatever your buying needs, we can help. Give us a call on (02) 8916 6172 or email our team at today!

For further information on our buyer’s agent services please view our Services page here

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