A new study has suggested that the rapid growth of the housing market could affect both the outcomes and intentions of families to have more children.
The research, led by economists from the University of Sydney and published in the Journal of Housing Economics, measured people’s intentions for more children than property prices.
It found that when the property market booms, Australian renters are much less likely to want and have more children, while mortgage-holders are more encouraged to have children.
“While there has been significant debate about appropriate policy settings in light of rapidly rising home prices and its impact on homeownership, there has been little discussion of the implications of housing market development on people’s decisions to have children,” said lead author Associate Professor Stephen Whelan said.
Researchers found that families that experienced a $100,000 (US$71,000) increase in housing assets were 18 percent more likely to have children. In addition, married couples with mortgages are most likely to have children.
Whelan said the study uncovered an important and perhaps surprising trend.
“Housing is a major cost of raising a child, therefore, as housing costs rise, it has become more expensive to raise children in Australia,” he said. “Tenants, who are generally less financially secure than homeowners, may delay having children because of rapidly rising home prices.”
The study used data from 25- to 45-year-old women in Australia about their likelihood of having children in the future from the results of the annual Household, Income and Labor Mobility (HILDA) survey. This was then measured against LGA-based average property price data.
Whelan said that given that property prices have risen by more than 20 percent over the past two years, the results are now likely to be even stronger.
Since 1976, Australia’s fertility rate has been below the replacement level, which is the level where populations are passed from one generation to the next without migration.
Meanwhile, the Australian Bureau of Statistics (ABS) revealed in December that the country’s fertility rate had hit a record low of 1.58 children per woman in 2020.
“The record low total fertility rate can be attributed to low births and birth registrations in most jurisdictions in a year marked by COVID-19 disruptions,” said Bidar Cho, ABS’s director of demographics.