Buyers and renters found housing affordability a little harder through the first months of 2024, according to a new report released this week.
The ANZ CoreLogic Housing Affordability Report* has revealed that the portion of income required to service median new rents reached a new high of 32.2 per cent nationally in March 2024.
The study shows that the demographic of private renters is shifting to higher-income earners, due to a long-term decline in the rate of home ownership, while in lower-cost markets, the increase in private rents has absorbed the recent $48 minimum wage increase set by the Fair Work Commission.
Buyers are also feeling the pinch, with the portion of median income required to service a new mortgage reached a series national high of 48.9 per cent in March.
Nationally, CoreLogic estimates the time to save a 20 per cent deposit has increased to 10.3 years for a median household income, assuming an annual savings rate of 15 per cent.
Approximately 37 per cent of properties are serviceable for median-income buyers expending 40 per cent of income, compared to 17 per cent of properties using 30 per cent of median income.
Launching the report, CoreLogic Head of Residential Research Australia Eliza Owen, remarked that the portion of owner-occupied lending secured for new first home buyer purchases was elevated in February at 29.2%, but is down from HomeBuilder highs of 33% in January 2021.
“As the year progresses and home values are likely to continue rising, the share of first home buyer activity is likely to weaken further,” she predicts.
ANZ Group Chief Economist, Richard Yetsenga agreed, noting that significant challenges are ongoing with supply constrained and material costs high.
“International competition for both materials and labour remains intense”, he added.
*The ANZ CoreLogic Housing Affordability Report looks at the affordability of housing in Australia in the first quarter of 2024, for both renters and owners.