Census: Grown-up kids staying at home surges 20%

A much higher share of children aged 25 to 34 are living with their parents.

Matilda Finnegan, 26, has just rejoined one of the fastest growing social categories in Australia by moving back in to her parents home in Warriewood on Sydney's northern beaches.

The number of young people living at home well into their working life, who have been dubbed the "smashed avocado" generation, has climbed 20% in just five years, according to data from the 2016 census, released in June this year.

There are now 390,967 non-dependent children aged from 25 to 34 living at home compared with 326,992 just five years ago, confirming speculation that rising house prices and rents and a weak job market are discouraging people from moving out and buying their properties.

Social commentator Bernard Salt caused a social media storm last year by calling these young people the "smashed avocado" generation because they preferred to spend their money on trendy food in cafes rather than save up for a house that would allow them to move out.

The growth in children staying at home is much faster than the 13.4% increase in the 25-to-34 age cohort in general. Australia's total population grew 9% to 23,401,892.

Finnegan, who is trying to build up a personal training business and has just decided to move back home with her parent to avoid paying $250 a week in rent, says that the stereotype of the slothful child living at home is unfair. She says young people these days cannot afford to move out.

"I approve of smashed avocado on toast because I am a personal trainer who likes healthy food in the morning but the price of everyday living is just ridiculously expensive," says Finnegan.

On the other hand, she admits that when she moved back her parents were very supportive and only charged her minimal board. She says she is saving up for a house now that she is living at home with her parents and 20-year-old younger brother but realistically it will take her five years to save a deposit for a flat. "It all depends on how my business goes."

It is commonly argued the reason young people are staying at home is rising housing costs. Median rent on a Sydney house has gone from $351 to $440 over the past five years, the census says, and house prices have doubled.

Interestingly however, the increase in the number of people aged 24 to 35 living at home is no higher in expensive Sydney and Melbourne than elsewhere.

The rise over the past five years in grown-up children living at home is much faster than during the global financial crisis. In the five years from 2006 to 2011 the number of stay-at-home children rose 11%, about the same as the increase in population in that age cohort.

Another likely explanation for why more children are staying at home is the difficulty for young people to find regular work. Consultant PWC highlighted this as a factor in young people staying at home in a report last year.

At the start of the noughties when jobs were plentiful the trend was in the opposite direction and children were moving out of home. From 2001 to 2006 the number of children aged 25-34 living at home actually fell by 3% even as population rose.

Another indicator of the difficulty of moving out for the 25-34-year age group is that the number of people living alone has fallen. Equally the number of single parent households in that age group has barely grown.

But living in a couple seems to be a big help in moving out. The number of people living as a married or de facto couple has grown at 8% in the past five years.

Women seem better able to handle the stress of moving out of home. There are almost 50% more men aged 24-35 years old living at home than women.

The growth over the past five years means 11.6% of 25-34 year olds now live at home.

Some surveys suggest that most children expect to live at home till they are 30 but the good news in the census is that the number of children living at home drops dramatically after the age of 35.

 

This article was originally published by the Australian Financial Review on 27 June 2017. It represents the views of the author only and does not necessarily reflect the views of AMP.

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