The Housing Affordability Report released by the REIA in conjunction with Adelaide Bank has shown that across Australia, real estate has become notably more affordable over the last two years.
Findings from the report found that the required level of income needed to meet regular home loan repayments has now decreased down to 28.7 per cent. This signifies the lowest proportion in 10 years.
Through the report, the REIA found that real estate in Canberra and the rest of the Australian Capital Territory was the most affordable in the country.
REIA President Peter Bushby noted that this was due to the higher average incomes for workers in the state.
At the same time, real estate in Sydney and the rest of New South Wales continued to be the least affordable market in the country.
Here, the proportion of income required to meet home loan repayments was 5.6 per cent higher than the national average.
“With the exception of the Northern Territory, all states and territories recorded improvements over the quarter, the largest in Queensland where the proportion of income required in order to meet loan repayments dropped by 1.9 percentage points to 26 per cent,” Mr Bushby stated in a September 4 statement.
This is encouraging news for current and prospective home buyers in the country, as residential property prices continue to increase over the year – placing pressure on household budgets.
During August, property values rose by a further 0.5 per cent across the country.
Some capital cities performed better than others, such as Sydney and Perth experiencing sharp rises of 7 per cent and 9.4 per cent for the year ending August 2013.
Mr Bushby stated that in order for buyer activity to keep increasing in the market, there needs to be more support for first home buyers.
“More is required to entice first home buyers back though, through stamp duty reforms, access to
superannuation and first home buyers’ assistance. They made up just 14.6 per cent of the owner-occupier market, a persistently low number compared to the long-run average proportion of 20 per cent,” he said.