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The March quarter edition of the Adelaide Bank/Real Estate Institute of Australia Housing Affordability Report shows an improvement in housing affordability nationally, with the proportion of median family income required to meet average loan repayments decreasing by 0.3 of a percentage point to 31.3 per cent.
The report also found that the number of first home buyers decreased by 14.5 per cent during the quarter, but year-on-year, there was actually a 28 per cent increase compared with the March 2017 quarter.
Rental affordability declined slightly, with the proportion of income required to meet average rental payments increasing to 24.8 per cent, or a quarterly increase of 0.3 of a percentage point.
Head of distribution at Adelaide Bank Darren Kasehagen said that the improvement in housing affordability nationally is to be welcomed.
“It is great to see that when compared to the corresponding quarter of 2017, the number of first home buyers has increased in all states and territories year-on-year — and by more than 80 per cent in NSW and the ACT.
“The reduction in the total number of new loans compared to the same quarter last year has the potential to be a continuing trend, and the same could be said for the reduction in the average loan size experienced in the March quarter, as overall lending standards improve across the industry, making access to credit a little harder.”
Victoria
Of the total number of Australian first home buyers that purchased during the March quarter, 8,169 were from Victoria.
The number of loans to first home buyers decreased by 17.9 per cent for the quarter but increased by 35.3 per cent year-on-year.
New South Wales
The proportion of family income required to meet loan repayments decreased by 1.3 per cent to 36.5 per cent. New South Wales remains the least affordable state or territory in which to buy a home.
Of the total number of Australian first home buyers that purchased during the March quarter, 24.6 per cent were from New South Wales.
Queensland
The proportion of income required to meet home loan repayments decreased to 27.5 per cent, a 0.1 of a percentage point decrease over the quarter.
The proportion of first home buyers in the state’s owner-occupier market was 26.7 per cent.
South Australia
South Australia recorded a decline in housing affordability, with the proportion of income required to meet monthly loan repayments increasing to 27.2 per cent or 0.8 of a percentage point over the quarter.
In the national breakdown, 4.9 per cent of first home buyers were from South Australia, while the proportion of first home buyers in the state’s owner-occupier market recorded a decrease of 13.7 per cent.
Western Australia
The number of first home buyers in Western Australia decreased by 10.5 per cent over the quarter. As many as 13.5 per cent of all Australian first home buyers were from Western Australia.
Tasmania
Housing affordability in Tasmania improved, with the proportion of income required to meet home loan repayments decreasing to 24.5 per cent, a decline of 1.2 per cent over the quarter or 0.9 of a percentage point year-on-year.
Australian Capital Territory
Housing affordability in the Australian Capital Territory declined slightly, with the proportion of income required to meet home loan repayments increasing to 19.7 per cent, a 0.1 of a percentage point drop over the quarter or a decrease of 0.4 of a percentage point compared to the same quarter last year.
Northern Territory
Housing affordability in the Northern Territory improved, with the proportion of income required to meet loan repayments decreasing to 19.8 per cent for the quarter or 1.1 per cent. This was a decrease of 1.3 per cent year-on-year.
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