MILLENIALS and young working professionals have been excluded from the housing market and may never own homes of their own due to high levels of unemployment among this demographic.
This is according to a research report on gender and age behaviour with regard to home ownership by Ruusa Nandago, Market Research Manager, FNB Namibia.
In her newly released research, Nandago states that the average age of a home buyer in Namibia shows a declining trend and the average age has come down to 38 years old, the lowest it has been in 9 years.
“When compared to other jurisdictions, Namibians buy their houses at a much later stage in life. The average age in the UK, for example, is much lower at 30 years while the average age in the US is 32 years old. Interestingly, the average age for single women home buyers (35 years) is slightly lower than that of men (37 years),” she explained.
She further revealed that the youth have low participation rates in the housing market and that the bulk of housing transactions are done by individuals in the 30 to 39 age group (49%), followed by individuals in the 40 to 49 age group (28%), then by individuals in the 20 to 29 age group (14%), then individuals in the 50 to 59 age group (8%) and finally individuals over 60 years old (1%).
Nandago stated that the ultra-low housing market participation rate of individuals in the 20 to 29 age category is unsurprising, given the high levels of youth unemployment across the country.
She further noted that individuals over 60 buy the biggest houses.
“Individuals in the 20 to 29 age group have the smallest sized houses, which we attribute to the fact that these are first time buyers who have not accumulated sufficient wealth to buy larger properties. The size of a house becomes increasingly larger as individuals move into higher age groups. Surprisingly, however, individuals in the over 60 age category buy the biggest houses in terms of size although they make up the smallest proportion of home buyers. Typically, it would be expected that individuals in this category downsize their houses as they prepare for retirement,” Nandago said.
Further to that, said Nandago, the Namibian labour market was characterised by gender inequality and age gaps.
“Data from the FNB House Price Index also shows that disparities in employment and income according to gender and age are realised in the housing market. These are observed when looking at the number of transactions, the price of houses and the size of the house stand purchased. Owning a home fulfils the basic human need for shelter and a house is likely to be the largest asset owned by a household for wealth accumulation. It is of utmost importance that individuals of different groups have equal access to housing as this improves their quality of life,” Nandago said.
She advised that it is, therefore, necessary to address issues of gender discrimination in the labour market and the high youth unemployment rate in order to close these gaps in the housing market.