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CEO AllenWargent Property Buyers, & WargentAdvisory (institutional). 6 x finance author.

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Thursday, 1 December 2016

How not to get divorced

Brides, grooms & divorcees...all getting older

I often read that Aussies will cohabit later, get married later, that there will be more divorces, and so on, all of which will lead to a more fractured society.

There are supposedly going to be more divorcees, more 'Mingles' or middle-aged singles, and more lone occupant households, with the decline of larger households meaning that more dwellings will be required to house an equivalent number of people.

In turn, this is supposed to create massive demand for more compact, secure, and low maintenance dwellings, such as units, apartments, duplexes, and townhouses, particularly as younger people typically want to live close to the action, in suburbs close to the Central Business Districts of the capital cities. 

Image result for arguing couple cartoon funny

Well, that's the theory anyway! But is it actually happening?

I took a run through at the latest Marriages and Divorces figures, and in a nutshell the answer is...yes it is.

Let's take a quick inventory of the key findings!

Still marrying, but later (try before you buy)

Aussies are still generally quite keen on getting married eventually, and there were still some 113,595 marriages in 2015, with more than 80 per cent of couples now cohabiting before choosing to tie the knot.

Although the number of marriages was down by -6.3 per cent from 121,197 in 2014, the total number of marriages has stayed fairly constant over the past 20 years, having risen moderately from 109,386 in 1995.

Of course, the total resident population is much higher today than it was in 1995, and as such the marriage rate has declined from 6.1 per 1000 people to 5.2 in 2014, and then only 4.8 in 2015. 

The lower result in 2015 can, however, largely be explained by two unrelated factors. Firstly, by a simple administrative data anomaly, being the number of lagged registrations in the calendar year. 

Secondly, and more interestingly, there has been the emergence of Relationship Registers as an alternative to marriage in a number of states, which accounts for some of the remainder of the decline. 

There has been a huge 74 per cent surge in formally registered relationships from 5,379 in 2012 to 9,344 in 2015. 

From a demographic perspective the most notable thing is that we are getting married later, and marriages are lasting longer.

Today the average 'first-time' groom (30.1 years) and bride (28.5 years) are somewhat older than we'd have expected to see couple of decades ago, and they can also expect to stay married for longer on average (12.1 years, up from 11 years in 1995).

The median age for all grooms and brides, inclusive of those not marrying for the first time, was a little older again. 

As for the most popular month of the year to get married, it's October, which accounted for 12 per cent of all marriages (incidentally, I wouldn't take the state level data too literally, since plenty of couples choose to elope to wed interstate!). 

How not to get divorced

We've probably all been miffed at one time or another to have bought an electric toaster from a wedding gift registry only for the 'happy couple' to be divorced with the present barely unwrapped. You never get to see a refund, of course!

Sadly, the statistics below confirm that divorces in the first couple of years of marriage are all too common.

But how can we avoid joining the ranks of the divorced ourselves? 

Well, you'd definitely be asking the wrong person for relationship advice, but statistically if you can hang on until year 5 of your marriage, the odds of survival begin to increase significantly (I'm relieved to note that there's hope for me yet!). In short, try to hang in there!

The divorce rate at 2 per 1000 people was relatively unchanged from the prior year, although the absolute number of divorces increased from 46,498 in 2014 to 48,517 in 2015. 

With people marrying later on average, and marriages lasting longer, we are naturally on average divorcing later in life too, with the average age of divorcees up by more than 5 years since 1995 to a record high. 

The wrap

This is one instance where the statistics support the theory, and households are indeed set to become more fractured over time. 

While the absolute number of marriages plus registered relationships has remained fairly constant, mostly people are getting married later, buying their first home later, divorcing later, and dying later.

Over time, therefore, demand for more compact, secure and lower maintenance dwellings should mirror these trends.