Are the rising real estate prices deterring young people from buying real estate? Europace AG addressed this question in a short study.
Europace looked at the average age of buyers of apartments, houses, existing properties and new buildings. According to the funding platform, there is actually a trend in terms of average age.
Europace contradicts numerous other studies
As Europace explains in its short study, various studies come to the conclusion that real estate buyers are on average getting older. The transaction platform contradicts this trend with the results of its own study. On the basis of the published short study and the data it contains, it can be seen that the average age of a property buyer for owner-occupation has decreased in 2020 compared to 2012. In 2012, the average age of a buyer was 37.5 years, in 2020 it was 36.7 years: “This is not a clear development, but a trend can still be identified,” says Europace in the study.
This trend can be seen much more clearly among private buyers who use the property they have bought for rent. According to the results of the study, the decline in the average age is much more pronounced here: from 44.6 years in 2012 to 40.6 years in 2020. This also includes the proportion of 18 to 25 year olds and 26 to 35-year-olds increased in properties acquired for rental in the period under review. Around 37 percent of the volume in this area currently went to these two age groups. For comparison: in 2012 their share was 19 percent. This shows the greatly increased interest of the two youngest age groups in buying a property for subsequent rental.
Possible reasons for an earlier property purchase
According to Europace, there are, on the one hand, legitimate reasons to believe that younger property buyers are currently reluctant to buy and that the average age may tend to move in the direction of older people. Among other things, the rising property prices in connection with a potentially lower purchasing power, a lower income in the early stages of working life or longer periods of training and study are mentioned here. None of this speaks in favor of an early long-term investment in a property. On the other hand, these aspects are offset by the currently extremely low level of interest rates, the lack of investment alternatives and the construction child allowance, which suits a decision to buy real estate at an early stage, according to Europace.
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