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4102.0 - Australian Social Trends, 2003  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 03/06/2003   
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Contents >> Housing >> Housing arrangements: Home ownership across Australia

Housing arrangements: Home ownership across Australia

More than two-thirds of Australian households owned or were buying their dwelling at the time of the August 2001 Census. However, home ownership rates vary considerably across Australia.

Home ownership is an aspiration for many Australians and has widely been referred to as ‘the great Australian dream’.1 This desire for home ownership is consistent with relatively high home ownership rates in Australia compared with many other developed countries. Ownership may bring a sense of privacy and autonomy for the owner, including the freedom to make changes to the physical structure and appearance of the home. Home ownership also provides owners with a financial asset which can be of future benefit, especially in later life when a household’s earning potential may be reduced.
In August 2001, 4.6 million (69%) households in Australia owned their dwellings (with or without a mortgage). However, home ownership rates vary considerably across Australia. This article explores these variations and the social and demographic characteristics of households that own their home (with or without a mortgage).


Home ownership
Data in this article were drawn from the Census of Population and Housing, conducted in August 2001.

The home ownership rate in this article refers to the proportion of households in occupied private dwellings which are fully owned or being purchased by them, as a proportion of all households.

This article only considers private dwellings which were occupied on census night. It excludes households not classifiable by household type.


Geographical classifications
This article uses a range of different geographic classifications from the Australian Standard Geographical Classification (ASGC). For further information see Statistical Geography: Volume 1 - Australian Standard Geographical Classifications (ASGC), 2001 (ABS cat. no. 1216.0).

In very general terms, a Statistical Local Area (SLA) is based on the boundary of the corresponding local government area (LGA), if such an LGA exists and does not contain too many people. There were 1,353 SLAs in Australia in 2001.

A Statistical Subdivision (SSD) consists of one or more adjoining SLAs that are socially and economically alike. People in an SSD usually associate with each other in areas such as employment, health, education, tourism and industry, or share transport and communication networks. There were 207 SSDs in Australia in 2001.

The ABS Remoteness classification is used to examine home ownership in the six Remoteness Areas. Remoteness is calculated using the road distance to different sized urban centres, where the population size is considered to govern the range and type of services available. The six Remoteness Areas are: Major Cities of Australia; Inner Regional Australia; Outer Regional Australia; Remote Australia; Very Remote Australia; and Migratory. The Remoteness Area names used in this article are abbreviated versions of these official names with ‘Australia’ omitted.

HOUSEHOLDS(a): HOME OWNERSHIP RATE(b) BY STATISTICAL LOCAL AREA - 2001
Map - Households(a): Home ownership rate(b) by Statistical Local Area - 2001

(a) In occupied private dwellings. Excludes households not classifiable by household type, including those in Migratory category.
(b) Comprises households that were fully owned or being purchased.

Source: ABS 2001 Census of Population and Housing


Geographic variations in home ownership
Across Statistical Local Areas (SLAs), many of which have relatively small populations, comparatively high ownership rates were found in and around capital cities. In most of these SLAs, over 75% of households owned their dwelling (with or without a mortgage). Outside of capital cities, equally high ownership rates were found among households located in areas along the south eastern coast of Australia; in Tasmania; Litchfield - Pt B in the Northern Terrritory; and in areas close to regional cities such as Townsville (Queensland) and Geraldton (Western Australia). Adjoining these SLAs and spreading inland from the capital cities, the proportion of households that owned their home tended to be between 65% and less than 75%. Ownership rates were generally lower the more remote the area. Within SLAs in western New South Wales, central Queensland, and the south and central coast of Western Australia, the proportion of households that owned their home was generally between 45% and less than 65%. SLAs in central Australia and far north Queensland tended to have ownership rates of less than 45%.

While analysis at the SLA level shows differences in home ownership rates across relatively small areas of Australia, combining similar adjoining SLAs together to the Statistical Subdivision (SSD) level is useful in providing a broader perspective. In August 2001, seven of the ten SSDs with the highest ownership rates were in Victoria. However, Beaudesert Shire Part A, located on the southern fringe of Brisbane, had the highest ownership rate (87%) of all SSDs.

In New South Wales and Victoria, both the highest and lowest ownership rates were in capital city SSDs (i.e. within Sydney and Melbourne). In both of these cities, households in the central part of the city tended to have the lowest propensity to own their home (45% in Inner Sydney SSD and 43% in Inner Melbourne SSD). Households in Central Northern Sydney, and in the surrounding SSDs of Inner Melbourne such as South Loddon, Yarra Ranges Shire Part A, and Northern Outer Melbourne had the highest ownership rates (all above 82%). In Queensland, South Australia and Western Australia, households in SSDs on the outskirts of the capital city tended to be more likely to own their home, while those located in more remote areas of the state were least likely.

Tasmania had the least variation in ownership rates, with at least 69% of households owning their home across all SSDs. In the Australian Capital Territory, SSDs on the outskirts of Canberra had higher ownership rates (about 76%) than SSDs closer to the city centre, which had ownership rates of about 53%.

The five SSDs with the lowest ownership rates were all in the Northern Territory. This may reflect the higher proportions of Aboriginal and Torres Strait Islander peoples living in these SSDs. Indigenous peoples generally have lower ownership rates than non-Indigenous people (for more information see Australian Social Trends 2001, Aboriginal and Torres Strait Islander housing in non-remote areas). Many Indigenous peoples living in remote communities share ownership of land, and have an Indigenous community housing organisation administering property, providing security of tenure, as well as several of the other benefits of individual ownership not usually available in the private rental market.

In SSDs where 75% or more of households owned their home, median individual incomes tended to be above the Australian level. However, a high median income did not always indicate higher ownership rates across all SSDs. For example, this was less likely to be the case in some SSDs in remote areas where higher proportions of people are employed in the Mining industry. People working in this industry may be more likely to be employed on short-term contracts, and tend to rent, or live rent-free, rather than own their house.

STATISTICAL SUBDIVISIONS(a) WITH THE LOWEST AND HIGHEST HOME OWNERSHIP RATE(b) IN EACH STATE AND TERRITORY - 2001
Highest home ownership rate
Lowest home ownership rate
State or territory
Statistical Subdivision
%
Statistical Subdivision
%

NSWCentral Northern Sydney
81.8
Inner Sydney
45.2
Vic.South Loddon
84.0
Inner Melbourne
43.4
QldBeaudesert Shire Part A
86.6
North West
50.5
SABarossa
81.3
Far North
42.4
WAEast Metropolitan
76.6
Ord
26.3
Tas.Southern
78.5
Lyell
69.8
NTLitchfield Shire
79.0
Bathurst-Melville
0.4
ACTTuggeranong
76.2
North Canberra
53.2

(a) Excludes Statistical Subdivisions containing fewer than 400 households.
(b) Rates refer to households. Includes households in occupied private dwellings that are fully owned or being purchased. Excludes households not classifiable by household type, including those in Migratory category.

Source: ABS 2001 Census of Population and Housing.


Characteristics of households
In keeping with regions nearest Major Cities having the highest ownership rates and those in central and northern Australia having the lowest, in August 2001, Remoteness Areas show ownership rates generally decreasing as remoteness increased. Inner Regional areas had the highest ownership rate (72%), while Major Cities had a slightly lower ownership rate (69%). Households in Very Remote areas were least likely to own their home (36%). Many of the differences in ownership rates across Remoteness Areas reflect differences in the characteristics of people living in each area.

...age
Home ownership rates generally increase with the age of the household reference person. This is in keeping with younger people being less likely to own their home for a range of social and economic reasons (see Australian Social Trends 2001, Housing experience through life-cycle stages). While ownership rates were 75% for households with a reference person aged 35-64 years, ownership rates were higher for households with a reference person aged 65-74 years (83%), and for those with a reference person aged 75 years and over (81%).

HOUSEHOLDS(a): HOME OWNERSHIP RATES(b) BY AGE OF REFERENCE PERSON(c) AND REMOTENESS AREA - 2001


Remoteness Area


Age group of household
reference person (years)

Major Cities

Inner
Regional

Outer Regional

Remote

Very
Remote

Australia




%

%

%

%

%

%

15-34

44.1

45.9

41.3

33.6

18.7

43.8

35-64

74.8

77.0

73.9

63.4

39.8

74.7

65-74

82.6

85.1

83.1

79.3

60.0

83.1

75 and over

80.8

82.5

80.2

76.1

61.5

81.1









Total that owned their dwelling(d)

69.0

72.3

68.4

57.6

35.7

69.2




'000

'000

'000

'000

'000

'000









All households

4,476.8

1,413.6

704.2

106.7

43.6

6,744.8


(a) In occupied private dwellings. Excludes households not classifiable by household type, including those in Migratory category.

(b) Comprises households that were fully owned or being purchased.

(c) The household reference person is chosen by applying, to all usual residents aged 15 years and over in the household, the following selection criteria, in order of precedence: the person with the highest tenure type (ranked from owner without a mortgage, owner with a mortgage, renter, other tenure), the person with the highest income, the eldest person.
(d) Households where tenure type was not stated were excluded prior to the calculation of percentages.

Source: ABS 2001 Census of Population and Housing.


For all age groups, home ownership rates were higher in Major Cities than in Remote and Very Remote areas. This difference was most evident among households with a reference person aged 35-64 years and least evident among households with a reference person aged 75 years or older.

Households in Inner Regional areas with a reference person aged 65-74 years had the highest propensity to own their home of all Remoteness Areas and all age groups (85%). This may be linked to people moving out of capital cities after retirement to settle in less populous areas such as along Australia's eastern coast. However, for most Remoteness Areas, ownership rates decreased slightly for households with a reference person aged 75 years or over, and were lower again for households with a reference person aged 85 years or over. That said, this was not the case in Very Remote areas where ownership rates increased for households with a reference person aged 75 years or over. This is consistent with the comparatively high proportion of Indigenous peoples in these areas and their lower life expectancy (and lower home ownership rates) compared with non-Indigenous people. It may also reflect (the mainly non-Indigenous) people in this age group who are in ill health relocating to less remote areas to access health and care facilities, while those in good health may be more likely to remain in their homes in Very Remote areas (see Australian Social Trends 2001, Housing experience through life-cycle stages).

...household income
Home ownership rates generally increased with household income. In 2001, 81% of households with a weekly gross income of $1,500 or more per week owned their home. In contrast, 56% of households with an income between $1 and $299 per week owned their home. This partly reflects the comparatively high proportion of age pension recipients in this income group which offset other households with relatively lower home ownership rates.

HOUSEHOLDS(a)(b): HOME OWNERSHIP RATES(c) BY WEEKLY GROSS INCOME AND REMOTENESS AREA - 2001
Remoteness Area
Weekly gross household income
Major
Cities
Inner
Regional
Outer Regional
Remote
Very
Remote
Australia

%
%
%
%
%
%
$1 to $299
54.7
59.0
58.1
55.7
42.5
56.1
$300 to $699
62.0
67.0
65.7
58.3
35.9
63.5
$700 to $1499
71.3
77.5
71.1
55.2
29.9
72.0
$1,500 or more
80.3
87.1
79.0
57.2
33.4
80.6

Total that owned their dwelling(d)
68.9
72.0
68.0
56.7
34.0
69.0

'000
'000
'000
'000
'000
'000

Total households(b)
4,352.8
1,377.4
682.0
102.3
41.1
6,555.7

(a) In occupied private dwellings. Excludes households not classifiable by household type, including those in Migratory category.
(b) Excludes households with nil or negative income.
(c) Comprises households that were fully owned or being purchased.
(d) Households with partially incomplete incomes, not stated incomes, or not stated tenure type were excluded prior to the calculation of percentages.

Source: ABS 2001 Census of Population and Housing.


In contrast, home ownership rates in Very Remote areas tended to decrease as household income increased. This different pattern among households in Very Remote areas is likely to be linked to some of the industries employing people living in these areas. For example, people employed in the Mining, Government administration and defence, and Education industries often live in remote areas for relatively short periods or fixed duration. These people generally have tenure arrangements such as rental, or rent-free accommodation. In contrast, people employed in agricultural based industries may have more permanency in a local area. Households in Very Remote areas with a reference person earning a weekly gross income of $1,000 or more employed in the Mining industry accounted for 18% of all households in that area. Those with a reference person employed in Government administration and defence, and in the Education industries accounted for 12% and 10% respectively. Households with a reference person earning over $1,000 per week employed in the Agriculture, forestry and fishing industry accounted for 15%. Those employed in the Mining, Government administration and defence, and Education industries had ownership rates of 21%, 17% and 15% respectively, while those employed in Agriculture, forestry and fishing were most likely to own their home (70%).

If mortgage repayments constitute a substantial proportion of a household’s income (for this article a threshold of 25% has been used), the household may experience financial difficulty because of their limited income remaining for other expenses. In August 2001 there were 1.8 million households who were paying off a mortgage. Of these households, 26% were spending 25% or more of their household income on housing loan repayments.

HOUSEHOLDS(a) WITH A MORTGAGE: PROPORTION THAT SPENT 25 PER CENT OR MORE OF THEIR WEEKLY GROSS INCOME(b) ON HOUSING LOAN REPAYMENTS BY REMOTENESS AREA - 2001
Remoteness Area
Major
Cities
Inner
Regional
Outer Regional
Remote
Very
Remote
Australia

Weekly gross household income
%
%
%
%
%
%
$1 to $299
70.4
70.2
70.1
66.2
62.1
70.2
$300 to $699
58.9
49.4
44.1
43.6
34.7
54.1
$700 to $1,499
26.1
17.3
16.1
16.7
11.2
23.0
$1,500 or more
12.6
7.4
6.0
5.2
3.0
11.4

Total households with a mortgage(c)
27.0
24.3
23.4
21.3
17.0
26.0

(a) In occupied private dwellings that are fully owned or being purchased. Excludes households not classifiable by household type, including those in Migratory category.
(b) Excludes households with nil or negative incomes.
(c) Households with partially incomplete, or not stated incomes were excluded prior to the calculation of percentages.

Source: ABS 2001 Census of Population and Housing.


As household income increased, the proportion of households spending 25% or more of their household income on housing loan repayments decreased. In households with an income between $1 and $299 per week in 2001, 70% were spending 25% or more of their household income on housing loan repayments. However, these households accounted for only 3% of all households with a mortgage. In contrast, 11% of households with a weekly income of $1,500 or more were spending 25% or more on housing loan repayments. This pattern was similar across each of the Remoteness Areas. However, households with a mortgage in Major Cities were more likely to be spending 25% or more of their household income on housing loan repayments than those in any other Remoteness Area, within each income range. Generally, houses and land in more remote areas are cheaper than in Major Cities. However, these savings can often be offset by higher building costs for new houses, and higher maintenance costs for older houses.2 Across Remoteness Areas, households with a mortgage in Very Remote areas were least likely to be spending 25% or more of their household's income on housing loan repayments.

Endnotes
1 Baum, S. and Wulff, M. 2001, Housing aspirations of Australian households: Positioning Paper, Australian Housing and Urban Research Institute.
2 Commonwealth Department of Housing and Regional Development 1994, Beyond the capitals, urban growth in regional Australia, Urban futures research program.

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