The stay-at-home generation: More young Australians are living with their parents for longer

A rising number of young Australians are remaining in the family home after finishing school, as economic and social factors drive them to delay independent living, according to new research. And they’re staying longer, with a marked increase in 20-somethings still living at home over the past two decades.

Just over 54 percent of young men and 47 percent of young women aged between 18 and 29 years are still living in the family home, according to the 18^th annual report for the longitudinal Household, Income and Labour Dynamics in Australia (HILDA) Survey. The survey tracks the lives of 17,000 Australians and reports each year on various aspects of life, including health and education, household and family relationships, and income and work. The latest HILDA data was collected in 2021 during the pandemic.

HILDA Survey Co-Director, Professor Roger Wilkins from Melbourne University, said the trend of more young people remaining in the family home began in the early 2000s. He attributes it to a variety of social and economic elements.

“We’ve seen a rise in higher education participation, declining full-time employment opportunities for young people, a rising cost in housing, and a trend towards later marriage and family formation,” he said.

Over the past 20 years, the prevalence of young people living with their parents has been highest among those aged 18 to 21 years, which is unsurprising given these are the first few years of post-school adulthood when many young people are studying and unable to work full time. However, the data also shows that young people are living with mum and dad for longer periods — and well into their 20s.

Among 18 to 29-year-olds, the age category that has seen the most growth in young men living at home is 22 to 25 years. It’s up 12 percent from 42.1 percent in 2001 to 54.1 percent in 2021. Among women, the age category with the highest growth is 18 to 21 years, up 17.6 percent from 61.9 percent in 2001 to 79.5 percent in 2021. The age category with the second highest growth rate for both men and women is 26 to 29 years, up 9.9 percent for men and 11.6 percent for women since 2001.

Professor of Sociology and Social Policy at Melbourne University, Lyn Craig, said the trend has broad macroeconomic implications for Australia. “Since the mid-20-teens, fertility has fallen below replacement in Australia for the first time and I think that has something to do with the price of housing and young people not being able to afford to establish an independent household away from parents,” she said.

During the early 2000s when this trend began, the Australian housing market was in a boom and buying was difficult for young people to afford. Today, simply renting has become hard to afford, particularly following a 40 percent surge in rents nationally since the pandemic began.

While some young people are constrained by economic factors, others are likely delaying independence by choice, Professor Wilkins said.

“Some young people would like to start their adulthood journey and to have their own home but Australia’s economic conditions aren’t allowing that. On the positive side, as a richer society with longer life expectancy, perhaps some young people are making a rational and conscious choice to delay getting into the hard yakka of life. They decide to enjoy themselves and have some fun while they are still young.”

Australia’s housing crisis will not be solved by first-home buyer incentives or tax changes alone, with leading property figures warning governments must tackle supply constraints if affordability is to improve.

Speaking at the Kanebridge Quarterly Property Leadership Summit in Sydney last week, expert project marketing specialist Sam Elbanna, property investor and fund manager Paul Miron and property consultant Karla McNeice said that a lack of housing supply remained the central issue facing the market.

Elbanna, Director of CPM Realty with more than 30 years’ experience in project sales, argued that successive governments had focused too heavily on stimulating demand rather than addressing the barriers preventing new housing from being delivered.

“The misconception is that politicians think the way to solve the housing crisis is to drive demand,” he said.

“The reality is that’s not the way. This is a supply-side problem, and it needs to be solved on the supply side.”

Drawing on his experience in project sales, Elbanna said policies designed to help first-home buyers often had unintended consequences, pointing to previous grants that ultimately flowed through to higher property prices.

Instead, he said developers were facing increasing red tape, approval delays and rising costs, which were discouraging new housing supply.

“In the absence of stock, demand exceeds supply,” he said.

Miron, a Co-Founder and Fund Manager of Msquared Capital, said the housing debate had become overly focused on tax policy while overlooking broader structural issues.

He argued that affordability challenges stemmed from a combination of factors, including planning constraints, supply shortages, migration levels and interest rates.

“No-one can be 100 per cent certain on the real reason for property prices is going up,” he said.

“The reason why property prices are higher is a combination of interest rates, lack of supply, migration, vacancy rates and maybe taxes play a role.”

Miron was critical of recent federal housing policy changes, warning they could reduce the number of new homes being built and further constrain supply that was even highlighted in the budget.

He also highlighted the importance of the property sector to the broader economy, noting that residential real estate and related industries employed more than one million Australians.

McNeice, who advises developers on sales strategy and market intelligence, said understanding buyers had become increasingly important as affordability pressures intensified.

While affordability remained a major consideration, she said today’s buyers were focused on value rather than simply price.

“People are looking for value for money,” she said.

She said buyers were increasingly evaluating factors such as transport connections, walkability, nearby amenities and flexible living spaces that could accommodate changing family needs.

“What infrastructure is going on? Can I walk to the shops? Can I meet people at the local cafe?” she said.

The panel also discussed the mounting pressures facing developers, with Elbanna arguing that many projects become financially unviable from the moment a site is purchased.

“The viability of a development happens at the moment the site is bought,” he said.

He said rising construction costs, higher interest rates and overly optimistic feasibility assumptions had left some developers exposed as market conditions changed.

While acknowledging the growing number of smaller and first-time developers entering the market, Elbanna said property development required expertise across finance, construction, marketing and legal disciplines.

“It is actually a business that requires a level of expertise,” he said.

Looking ahead, the panel agreed opportunities remained in the market despite current challenges.

Miron said property should continue to be viewed as a long-term investment and cautioned against trying to time short-term market movements.

McNeice said success would increasingly depend on identifying projects that genuinely met changing buyer expectations.

Elbanna said affordable housing remained achievable, but developers needed to deliver more than just homes.

“We can provide affordable housing in this country,” he said.

“But we’ve got to wrap that affordable housing with the things that people want.”

As Australia’s housing affordability debate intensifies, the panellists agreed on one point: without a meaningful increase in housing supply, demand-side measures alone are unlikely to solve the nation’s property challenges.

The stay-at-home generation: More young Australians are living with their parents for longer

Housing affordability, higher rates of tertiary study and delayed marriage are likely drivers

Australia’s housing affordability crisis is being fuelled by chronic undersupply, planning delays and rising development costs, as politicians continue to focus on the wrong solutions.