Research shows the number of Aussies taking up licenses at age 18 declined by 6 per cent between 2011 and 2016.
Over the same period, the median price of a home in Australia’s capital cities rose from $497,059 to $713,433, an increase of more than 43 per cent.
Dr Elizabeth Taylor, of RMIT, said Australia was splitting into two camps on car ownership – those who made sacrifices to live without a car and those who were centring their lives even more around their vehicle.
“Young people are becoming progressively less attached to their car,” Dr Taylor said. “There’s a growing sub-market of people that are more than willing to make the trade-off to have a nicer apartment without a parking spot.”
A $25,000 car owned outright will cost $5396 a year in running costs, fuel and depreciation, or $104 a week, according to a finder.com.au analysis. The same car with a five-year loan costs $11,270 a year or $217 a week, equating to more than $56,000 over five years.
Properties close to public transport cost more, but if you’re tempted to live further away and drive to the station each day, the running costs of a car add up.
Car loans can also play havoc with their owners’ borrowing capacity, so what’s the alternative?
Surprisingly, ride-sharing may come out ahead. Taking 10 short ride-sharing trips every week, each about $20, will cost about the same as owning a medium-priced financed car, but without the commitment of a car loan.