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- Overall housing and rental affordability declined across the nation, as more Australians suffer under housing stress while the market booms
- Housing affordability improved in New South Wales and South Australia, was steady in Western Australia and Australian Capital Territory and declined in the remaining states and territories, according to the latest Real Estate Institute of Australia’s Housing Affordability Report
- REIA President Adrian Kelly said overall housing affordability across Australia has declined with the proportion of income required to meet loan repayments increasing to 34.7 per cent in the first quarter of the year
- Rental affordability also declined, increasing to a 24.4 per cent proportion of income required to meet median rents, rising 0.4 per cent
- REIWA president Damian Collins said despite a strong market, WA enjoyed the most affordable rental and third most affordable housing markets in Australia, noting that, according to the report, the biggest issue facing WA right now is a shortage of properties to rent
Overall housing and rental affordability declined across the nation, as more Australians suffer under housing stress while the market booms.
Housing affordability improved in New South Wales and South Australia, steady in Western Australia and Australian Capital Territory but declined in the remaining states and territories, according to the latest Real Estate Institute of Australia’s Housing Affordability Report.
REIA President Adrian Kelly said overall housing affordability across Australia has declined with the proportion of income required to meet loan repayments increasing to 34.7 per cent in the first quarter of the year.
When compared to 12 months ago, housing affordability improved slightly, decreasing by 0.5 per cent, according to the report.
Rental affordability also declined, increasing to a 24.4 per cent proportion of income required to meet median rents, rising 0.4 per cent.
“The decline is consistent with the March quarter CPI which showed that the capital city weighted average rents remained unchanged for the March quarter following an increase of 0.1 per cent in the December 2020 quarter,” Kelly said.
Housing stress is typically defined as households that are paying rents or mortgages that are in excess of 30 per cent of their household income.
Under this metric, only SA, WA, NT and ACT are under the 30 per cent threshold, with Tasmania the only state or territory above it for rental affordability.
The property market in Australia is currently witnessing a boom in prices for both housing and rentals, with CoreLogic reporting a 10.6 per cent growth in property values across the country over the last year.
CoreLogic also reported rents rising 13 per cent and 6.4 per cent in the regional and capital city markets respectively over the last 12 months.
According to an Australian Property Institute and tech firm The Search People survey of nearly 600 people, nearly half of the respondents believed property in Australia is unaffordable.
The majority (63 per cent) of respondents expect a continued growth story for property values across Australia’s capital cities in the short to medium term with over half believing we are currently in a property bubble.
Another survey from finance brokers Savvy of 905 Australians found nine out of ten respondents were worried that property prices are becoming unaffordable.
REIWA president Damian Collins said despite a strong market, WA enjoyed the most affordable rental and third most affordable housing markets in Australia.
“Despite the WA property market being firmly in a recovery phase, WA buyers and tenants enjoy the most affordable prices of any other state in the country,” he said.
“To put the WA figures into perspective, in New South Wales, the proportion of income needed to meet repayments for housing was 43.5 per cent during the March quarter, while the proportion of income needed to meet rent payments was 28.6 per cent.
“That is significantly more than WA and highlights that despite the buoyant market conditions, WA buyers and tenants remain in a favourable position when it comes to affordability,” he explained.
Collins said the report highlighted that the biggest issue facing WA right now is a shortage of properties to rent.
