Useful facts without opinions: housing affordability improves?!
There’s been a lot said and written in recent years about housing affordability in Australia. “It’s getting harder!”, we’re often told. And we’re not arguing that saving for a deposit is easy (or convincing the Bank of Mum and Dad to stump up security)! And given this series of posts is all about facts and not opinions we’re not going to try to convince you of anything. We’ll just report these facts!
The latest report from the Housing Industry Association shows their Affordability Index at the best it’s been since 1999. Yep, according to their stats it’s not been this easy to buy an Australian home in 20 years. Cue the media release: “HIA’s Affordability Index is calculated for each of the eight capital cities and regional areas on a quarterly basis and takes into account the latest dwelling prices, mortgage interest rates and wage developments.”
Their senior economist says: “The main reason the HIA Affordability Index today is comparable with the level in 1999, despite house prices rising significantly faster than incomes, is that interest rates are 4.6 per cent today compared with 6.7 per cent in 1999. Average earnings have increased by 113 per cent over the 20 years to 2019, while the median home price has increased by 228 per cent but the lower interest rates have kept the cost of servicing a loan the same.”
The HIA says all capital cities saw an improvement in housing affordability over the June quarter, with Brisbane one of the better improvers rising 2.6%.
So there’s the facts! What do you think? Easier to buy right now?? Please share your thoughts…