Australians are trying to keep up appearances but it’s slowing down their ability to save for a home
Many Australians are feeling the pressure to keep up appearances and maintain a certain lifestyle they can showcase on social media - but it’s coming at a hefty cost, new research has found.
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One in three Australians are feeling the pressure to keep up appearances and maintain a certain lifestyle, and it’s hitting their hip pockets hard.
Australia remains one of the most indebted countries in the world, as new research by Mortgage Choice finds 35 per cent of people feel the pressure to look like they are doing well financially.
The company’s chief executive officer, Susan Mitchell, said many people — particularly those who were yet to buy property — were showing off their lifestyles and putting it ahead of buying their own home.
“Worryingly the research revealed that 38 per cent of Australians are choosing to forgo buying their own home in order to keep up appearances,” she said.
“Everyone else seems to be able to do everything and you want to participate. That’s part of it.”
Ms Mitchell said soaring house prices in the past decade, particularly in Sydney and Melbourne, often left first-home buyers despondent.
Buying a home seemed like “such a big mountain to climb”, she said.
“Although it’s very tempting to keep up with the trends it can be a dangerous strategy to live for today and not have a strategic plan for your longer term financial security.”.
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Despite property remaining expensive in many cities, prices are declining.
Australian Bureau of Statistics data shows that in the December quarter the national average price of homes fell by $15,700 to $651,100.
Single mum Sarah Mudford, 42, slowly climbed up the property ladder since buying her first property in 2009, and said it came down to being smart with her cash.
“I saved hard and worked hard, in the last five years I’ve saved to get into the investment property market,” she said.
“I also got Chinese homestay students to move into my house because I had spare rooms. That enabled me to continue to save and also pay for a holiday over to Europe for six weeks.”
Ms Mudford bought a five bedroom home in Melbourne in 2012 and then purchased an investment property — a two-bedroom unit in Brisbane last year.
She said it “was not spending on the little things” that helped her get ahead financially.
Financial adviser Scott Haywood warned younger Australians not to get caught up in “FOMO (fear of missing out) land”.
“You should live within your means and reduce debt,” he said.
“In an environment where we have no wage growth, people need to pull their head in, be realistic and understand where you are at financially rather than painting a picture on Facebook that makes you look wealthy.”
The Mortgage Choice research also found that about one in five Australians save nothing each pay cycle.
Originally published as Australians are trying to keep up appearances but it’s slowing down their ability to save for a home