More young people afford their own homes now

SALEH AL SHAIBANY - saleh_shaibani@yahoo.com - As more Omani graduates find jobs, young people find it easy to own properties than in the last 30 years.

Official statistics show that 43 per cent of Omanis either buy a property or build their homes within the first five years of working in the period between 2007 and 2017. Only 31 per cent of Omanis owned properties within five years of employment in the period between 1997 to 2007.

This shows a leap in better mortgage rates, higher pay packages and careful financial planning now practiced by the current younger generation.

In the last ten years, the average age of Omanis owning a house is 29 while in the previous decade it was 35, according to statistics. It shows that more Omanis now own homes six years younger than before. The pay package, according to official statistics, has increased by 30 per cent in the last decade compared with the 1990s due to a boost of business expansion in the private sector.

Young people also find that it is about 20 per cent cheaper to pay mortgage than to rent a house now. With attractive interest rates coupled by better salaries, it makes sense for them to buy a land and build or buy a house outrightly. While the job market is slowly getting better, more young adults will own their own homes to keep up the growing trend.

This is good news for house affordability for young adults but perhaps it paints a dull picture for landlords looking for tenants to rent their properties.

Financial institutions have a mixed outlook. They see a sharp rise in mortgages for private owners but a decline for build to rent market. With this scenario, the economic outlook in properties favour private ownership which means greater prosperity for young people looking for their first break in life. It is in contrast to what it was in the 1990s when young Omanis were priced out of the housing market. What is helping young people now is better education and financial security awareness. A sharp rise in education level among the young is the catalyst to the rapid change in house ownership.

They also save more money for their first home. However, the real significant change in the affordability of homes for young adults is the equality of gender that is more prevalent in Oman now than ever before.

In the 1990s, it was only the responsibility of the man to buy a house. Now, with widespread education, women also are breadwinners. They help with the mortgage and this is one single factor that has accelerated the home ownership for young people.

Another factor that helps young couples to own home earlier than their predecessors, is the assistance from parents, too.

A third of young people build their homes in the land provided by parents or from the financial help either in a form of loan or gifts. Parents in their 50s have no liabilities and it is easy to help their children to own their first home. It has been part of the tradition in Oman for parents to offer a helping in properties for centuries and the trend continues. However, only children with parents who can afford the gesture benefit from this.

The government also help out to make home ownership easy by distributing free lands but it is not always the case for half of the young people looking to own their homes. But there is also an increasing tendency for young people to start buying apartments too, which are cheaper than a house. This way, they give themselves a lever to prop their financials until they can afford a house of their dream.

For most of them, it starts the moment they land their first job. With prudent planning, from marriage choice to career building, they leave plenty of room for financial improvement. It is a contrast to the working generation of the 1990s. The millennium generation are much more matured, thanks to education and the help from their wives.