Australians have become more keen to purchase a house, according to CBA's latest Household Spending Intentions report.
The sharp uptrend in homebuying, which started in the middle of the year, continued into October and is closer to the record highs witnessed during the first half of 2017, when Sydney and Melbourne markets were booming.
CBA chief economist Michael Blythe said this is consistent with the ongoing increase in dwelling prices and the bottoming out of residential construction activity.
“The ongoing improvement in the home buying intentions series indicates that the low point for residential building construction will probably be around mid-2020,” he said.
Spending intentions on retail, entertainment, travel and education also posted improvements over the month.
Blythe said the current spending intentions support the Reserve Bank of Australia's view that the economy has already reached a “gentle turning point”.
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“But the improvement is quite modest given the size of tax rebates and interest rate cuts delivered in recent months. By fuelling fears about the economic outlook, rate cuts are probably blunting some of the potential boost from tax rebates and rising house prices,” he said.
Recent research by the ARC Centre of Excellence in Population Ageing Research (CEPAR) said there are changes in the priorities of Australians when it comes to buying a home.
The study found that younger Australians are less likely to commit to buying a home than they were in the past. Currently, the median age at which Australians buy their first home is 33, up from a five-decade average of 27.
Study author and CEPAR senior research fellow Rafal Chomik said delays in home purchases are broadly consistent with other social and demographic trends.
“Over the same period, the median age of getting a first job has increased by two years; finishing education has been delayed by five years; having a child has been delayed by seven years; and getting married is now taking place eight years later,” he said.