$1.2 million mortgage leaves Aussie couple with just $1,000 free cash a month, making having kids ‘impossible’
Australians in their 20s say the cost of living is an obstacle when it comes to having children.
Nick Vatandoust, 27, and his partner, 31, have done what many young couples in Sydney really struggle to do. They just bought their very first home and will settle on the property this Friday.
Like most first home purchases, it came with a lot of trade-offs, and of course, a lot of mortgage debt. It meant moving about an hour further out from the city and committing a lot of their household budget to future home loan repayments.
The couple used the government’s 5 per cent deposit scheme, but still had to pay stamp duty on the $1.3 million price of the Mount Annan property in the city’s southwest, signing up to a mortgage of more than $1.2 million.
“We were on a very, very tight budget and even a dollar over what we bought would have been a nightmare,” he told Yahoo Finance. “We took a risk, and hopefully it’s going to pay off.”
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The biggest trade off of all for the couple, however, is the extra time they believe it will take until they’re in a financial position to start having kids.
“I had to ask myself, what was more important? To have kids while we’re renting, or to buy a house first, and then sort of push back the idea of having kids for a few years, until we can actually afford to,” Nick said.
The couple ultimately wanted to have secure housing before raising a family. Nick works in finance while his partner works as a nurse and relies on overtime shifts to boost their household income.
With the mortgage debt and the cost of living, they think it will be about “four to five years” until they can afford to become parents.
Nick said he has done the household budget “a hundred times over” and says the pair will currently have about $1,000 left over each month after bills and expenses, and hopes interest rates can soon come down to relieve some pressure.
“Imagine trying to bring a child into this today, it’s impossible.”
It’s a common perception among his peer group due to concerns over the cost of living, he said.
“My best friend in the world, he’s 30 years old, he’s half Thai and grew up in Thailand. They’re planning to have children … but they’re actually planning to relocate back to Thailand to raise their child.”
Aussies say they intend to have fewer kids for financial reasons
The county’s birthrate has been on a steady decline in recent decades, hitting a current low of about 1.48 births per woman. According to the federal government’s recently released Intergenerational Report, that is tipped to go lower to 1.34 in the years ahead “driven by delayed family formation and smaller family sizes, underpinned by evolving social, economic and cultural trends”.
