The proportion of income required to meet home loan repayments across the country has dropped below 30 per cent for the first time in over five years, according to new data.
The latest Adelaide Bank/REIA Housing Affordability Report shows a slight improvement in housing affordability, with the proportion of income required to meet repayments dropping 0.5 per cent to 29.9 per cent.
Adelaide Bank’s general manager, Damian Percy, said the results were pleasing.
“The welcome news in this March 2013 quarter edition of the Adelaide Bank/REIA Housing Affordability Report is that the proportion of family income required to meet home loan repayments has dropped below 30 per cent for the first time in almost five years,” he said.
“This figure is significant because, traditionally, it’s the point that has been used to describe what is generally accepted as ‘housing stress’.”
Mr Percy said the results should spark debate about housing across the country.
“The figures for this quarter show that first home buyers are still ‘on strike’ everywhere except my home state of South Australia. But it’s not just affordability that’s dominating property conversations around the barbeque," he said.
“'Right-sizing’ our housing choices is becoming equally important as our cities expand. In my view, it is now an opportune time to broaden the debate surrounding housing affordability to include other impediments to people ‘right-sizing’ their housing.”
“This includes supply-side policies such as land releases and development costs at a state government level. The overall tax 'mix and take’ between the Commonwealth, states and territories needs to be periodically reviewed, and impediments to right-sizing must be part of this mix.”