Property Threat to great Australian dream Renters will exceed nation's home owners by next year Jessica Irvine Fewer than half of Australian adults will own a home by next year, as sky-high property prices lock younger generations out of the Australian dream.
Sydney is the centre of property price pain, and NSW has the equal lowest rate of home ownership in the country, according to a survey of 17,000 Australians. 
The shock finding that home owners will soon be in the minority is at odds with the commonly quoted figure that two- thirds of homes are owner-occupied, the rest rental homes.
On this measure, there has been significant decline in the proportion of households that are owner-occupied, from 69per cent in 2001 to 65per cent in 2014, the latest data from the Household, Income and Labour Dynamics in Australia reveals. In NSW, the fall has been even sharper and to an even lower level, from 68per cent to 63per cent, the survey by the Melbourne Institute at the University of Melbourne shows.
But not all adults who live in owner- occupied housing own the homes they live in, including elderly parents, siblings or live-in girlfriends or boyfriends.
At an individual level, just over half, or 51.7per cent, of Australians aged 18 or more own a home, the HILDA data shows, down steeply from 57per cent in 2002.
"It is likely that, in the next few years, less than half of adults will be home owners," the report, to be released on Wednesday, predicts.
Not everyone is renting by choice, according to Professor Roger Wilkins of the Melbourne Institute. "It's not like Germany, where, if you're renting, you have much more security of tenancy and it's a much closer substitute for owning. I think most people in Australia would prefer to own their own homes."
There is a clear generational divide in home ownership. About 80per cent of households headed by a person aged over 65own their homes, according to census data, a figure that has been remarkably stable since the 1960s.
But the proportion of households headed by a person aged 25 to 34 has fallen steadily since then from 60per cent to 47per cent. The disparity in home ownership rates is exacerbating a widening wealth gap between the generations.
The wealth of the typical Australian household headed by a person aged over 65 grew 23per cent between 2006 and 2014, from $535,000 to $656,000, the HILDA data shows.
But households headed by people aged 25 to 54 actually had their wealth shrink over the same period.
Professor Wilkins said there was no reason the wealth of older households should grow faster than younger households.
"You expect them to be richer, but there's no structural reason why they should be experiencing greater wealth growth than the other age groups."
Increasing inequality between generations was due instead to conscious policy changes, such as the decision to halve the tax on capital gains and super tax changes, which disproportionately benefited older Australians, and baby boomers in particular.
"I guess the baby boomers really piled into the investment housing market subsequent to that," Professor Wilkins said.
"They tend to have paid off their homes, so the house price growth helps them a lot more.
"The 2006 super changes that [Treasurer Peter] Costello introduced gave them a big free kick in terms of tax exempting a lot of their assets. There has been a big shift of assets into super, which is basically a legal tax shelter."
Indeed, wealth stored in super is predicted to surpass property wealth in coming decades as home ownership dwindles.