Millennials, those individuals born between 1977 and 1994, are likely to spend 3.04 times more on their first time home than the generation before them.
This is according to Lightstone Property, which has released a new report on the generational differences between home buyers in South Africa.
Although property inflation and living costs have significantly changed over the last 20 years – and the fact that a South African’s earning potential and spending power would have been affected by various economic factors and inflation amounts – the average house price for a first-time home owner is three times more than previous years, Lightstone found.
“Looking specifically at Generation X, a ‘first house’ is, on average, a third of the price of when you buy a house between the age of 26-35 (R388,000 vs R139,000),” said Michelle de Klerk, senior property analyst for Lightstone Property.
“As Generation Y, a ‘first home’ is more than half the price than a house you buy between the age of 26-35.”
“Naturally, house prices increase as the people within that generation get older; however, if we look specifically at Generation Y for the ages 18-25 against the actual inflation of homes, you will see that Generation Y followed the same trend as the market, although the economic crisis of 2007 – 2008 didn’t affect the dip in housing prices as drastically as the entire market over the same period,” said de Klerk
According to Lightstone, of the 262,629 property transactions that have occurred in 2018, millennials account for 103,853 of the transactions, with a total (millennial) purchase value adding up to over R86 billion.