Housing loan affordability has declined but that’s not deterring buyers, the Real Estate Institute of Australia (REIA) announced this week.
The latest Adelaide Bank/REIA Housing Affordability Report found the proportion of median family income required to meet average loan repayments has increased by 0.2 percentage points to 31.4 per cent.
REIA President Malcolm Gunning said that at the same time, the total number of loans and the number of loans to first home buyers increased by 9.6 per cent and 14.0 per cent respectively, with increases in all states and territories except Tasmania.
“First home buyers now make up around 16 per cent of total owner occupied housing”, Gunning said. “This rate has been dropping steadily over the past 5 years but seems to have stabilised over the past 18 months.”
In better news for renters, the proportion of median family income required to meet rent payments reduced by 0.6 percentage points over the quarter to 24.3 per cent.
Gunning noted this improvement was recorded across all states and territories except in Tasmania and the Australian Capital Territory.
“Historically, rental affordability declined markedly from the June quarter 2007 reaching its lowest point in the March quarter 2010”, he said. “Since then rental affordability has been showing a trend improvement reflecting the pickup in investment in housing from the end of 2011.”