According to tech consultancy CB Insights, the median house price in Sydney has increased fourfold since 2000, from $287,000 to $1 million. During the same period, the cost of setting up a business has fallen from $5 million to $5,000, opening a new door, especially for the younger generation.
"It's difficult to enter the home ownership market, so young people are thinking of alternatives, and building a business is an alternative route to building wealth," said venture capitalist Elaine Stead of Blue Sky. "And that path to wealth is becoming more tangible, easier to finance, and shorter in time frame."
The rate of home ownership for those aged 25 to 34 has fallen from 61 per cent to 47 per cent in the 30 years to 2011. Meanwhile, the registration of business names with the Australian Securities and Investments Commission jumped from 1.49 million to 1.99 million in the past two years, with new names being registered at a rate of 300,000 per year.
With home ownership and business ownership seemingly negating each other, at least in the short term, millennials are opting for the latter despite Australia's reputation as a home owning country.
"The people who are entrepreneurs have a desire for freedom that outweighs a desire for stability," Stead said. "About half of them are renting and the other half have a mortgage. It doesn't seem to worry them because wealth is in their business and most of them see their business as being able to generate 10 to 20 times as much wealth as home ownership."
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