Baby boomers still burdened by mortgage debt
One-third of baby boomers are still paying off a mortgage, while more than 18% are renters, according to property researcher BIS Shrapnel.
It has analysed data from the 2006 Census and compared it with the findings of the previous three censuses.
The study found 33.6% of the baby boomer generation – now aged between 44 and 62 – were making mortgage repayments in 2006 compared to only 23% in 2001.
Report author, Angie Zigomanis, said there could be several reasons for the increase. He said one explanation could be that adult children were staying longer at home, increasing household running costs and therefore lessening the ability of parents to pay off mortgages, although the 2006 Census figure of 23.3% of 20 to 34 year olds living at home had risen only slightly from the 21.5% in 1991.
Other possibilities were that older people weren’t in a hurry to repay mortgages before their retirement because of the existence of compulsory superannuation, or baby boomers simply wanted to trade up to larger and more expensive homes.
“The trend could also have something to do with people borrowing against equity in existing homes, whether it’s a personal loan to buy a car or margin borrowing,” he said.
The report found an overwhelming majority ( 79.9%) of over-65s owned their homes compared with 5.2% still paying off mortgages.
