According to the Real Estate Institute of Australia’s (REIA) latest June report, housing affordability has improved to levels last seen seven years ago.
REIA President Neville Sanders says, “The latest Adelaide Bank/REIA Housing Affordability Report shows that the proportion of the median family income required to meet average loan repayments was 29.4%, which is the best level since the June quarter 2009. Affordability improved through more favourable interest rates and modest increases in income.”
“Most states and territories saw improvements in housing affordability. The only quarterly decline was seen in the Australian Capital Territory while no change was recorded in New South Wales and Queensland.”
“Victoria recorded the greatest improvement across the country with the proportion of income required to meet average monthly loan repayments decreasing by 1.7 percentage points to 31.0%.”
“The quarter also brought good news for renters with rental affordability improving as the proportion of the median family income required to meet median rents declining from 25.1% in the March quarter to 24.8% in the second quarter of 2016. The Northern Territory saw the best improvement, followed by South Australia and Tasmania.”
“The lending figures show that owner occupiers are the dominant force in the moderating market in which the growth of investor activity has abated following the introduction of macro prudential measures. Disappointingly the proportion of first home buyers appears to be on a downward spiral and is at its lowest for over two decades. Western Australia has the largest proportion of first home buyers in the owner-occupier market nationally,” concluded Mr Sanders.