Migrants Top Aust-born on Home Ownership

Posted on 4/02/2016  
Migrants Top Aust-born on Home Ownership

Australia is a nation of migrants. In a typical year, around 60% of Australia’s population growth is due to overseas migration. A quarter of the population was born overseas and 43% are either migrants or the children of migrants.

Population growth underpins growth in the economy and in the housing market. And a recent report from profile.id.com.au examined home ownership trends with migrants.

“Typically, migrants arrive in our capital cities, particularly Sydney and Melbourne, but increasingly Brisbane and Perth as well,” the report said. “The combined capital cities of Australia have 31% of their population born overseas.”

The UK is the No.1 overseas birthplace, followed by New Zealand, China and India. Since World War II the next positions have been occupied by Italy and Greece but they have fallen substantially and Greek migrants fell out of the top 10 for the first time in 2011, replaced by Malaysia.

The top 20 increases in birthplace groups over the 10 years from 2004 to 2014 show a substantial shift in Australia’s migration, with a focus on Asian countries in recent years. The five leading sources of migrants over this recent period were India, China, NZ, the UK and the Philippines, in that order.

Census data shows us the housing path taken by migrants as well. Overseas-born populations are a little more likely to be outright home-owners (no mortgages) than Australian-born population (27.7% to 26.3%), due to the older age structure of many established migrant groups.

But overseas-born residents are much less likely to have a mortgage (33.8% to 42.4%) and more likely to be renting (32.5% to 26.2%).

“So it appears that older migrants mainly own their own homes while younger ones are more likely to be renting,” said the profile.id report.

Brisbane’s migrant community is the most likely to be renting (37.5%), followed by Sydney (35.2%), while Perth’s migrants are the most likely to have a mortgage (38.5%).

Generally migrants in regional areas (like the general population) are more often full home-owners, with regional Victoria’s migrant population having 39% outright home ownership (it’s 42.6% in regional Tasmania).

But the report says the pattern differs from country to country. The overseas countries of birth most likely to have a mortgage are headed by Sri Lanka. For Sri Lankan-born populations, their home ownership propensity is reflected in the areas they live - for example the City of Casey, a large first-home buyer growth area on Melbourne’s far south-eastern fringe.

Those most likely to be renting are people from Nepal, Sudan, Samoa, Bangladesh, South Korea and Irag, in that order. Renters are more likely to be young, so these countries represent those with the youngest age profile, most of them recently arrived and likely to be students. Around 80% of Australia’s population born in Nepal arrived between 2006 and 2011, and 28% were university or TAFE students.

These countries also have the highest proportion of their population in high-density dwellings (units in blocks of three or more storeys). Nepal is the highest, at 38%, followed by Korea (29%), Japan (24%), Bangladesh and Indonesia (24%) and China (23%).

 "This is reflective of both the age structure of migrants from these countries (relatively younger) and cultural preferences for higher-density housing and living close to cities,” the report said.

“The highest proportion of any nationality living in separate houses is those born in Australia (81.9%). This reflects Australians’ historic housing preferences, and also the predominance of Australian-born populations in regional and rural areas which tend to have little high-density housing.”

The countries of birth which showed the biggest increase in the numbers taking out mortgages were headed by Afghanistan, followed by Sudan, Taiwan, Singapore and China. These primarily represent countries of birth which showed a large increase in the late 1990s to early 2000s (some with substantial continued migration).

“It shows that migrants, like those born here, aspire to own their own homes, and after finding their feet in their new country, they do settle down and buy their dwellings.”

In contrast, those countries showing the highest rate of outright home ownership are almost all representative of the post-WWII wave of European migration, with Italy topping the list (68% of Italians fully own their homes), followed by Greece, Malta and Macedonia.

“What all this shows is that home ownership among migrants, like those who were born here, is highly correlated by age and year of arrival in Australia. Newly-arrived migrants generally rent for a few years until they become established, but then buy a house and pay it off.

“The longer you have been in Australia, the more likely you are to fully own your own home.”

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