According to new research, the country's housing affordability has improved over the past 10 years. Statistics from June 2019 indicates that while the national median dwelling price increased from $382,650 to $516,710 at an average annual rate of 3%, income outperformed housing at 3.1 percent per year.
This has been
accompanied by other positive factors. The ANU Centre for Social
Research and Methods puts annual household income at $59,020 in 2009
and $79,872 by 2019, whereas the RBA shows typical mortgage rates
dropped from 5.1 percent in 2009 to 4.1 percent by 2019.
Nationally, the
dwelling values to household income ratio has changed over the past
decade, rising from a low of 6.1 percent at the end of 2012 to a
recent high of 7.0 at the beginning of 2018. The ratio was reported
at 6.5 percent in June 2019, which compares to where it was in 2009.
A ratio of 6.5 simply means that the standard Australian household
spends 6.5 times its gross annual household income to buy the typical
homes.
This was beneficial for first-home buyers. New ING research shows that 69% of millennials saved in less than five years for a house deposit, despite widespread expectations, which takes twice as long. The ING data also shows that 50% of millennials are currently saving to buy due to historically low-interest rates, while 58% of homeowners are looking to investment properties or upsize. In most capital cities and all regional areas, except Victoria, the share of average household income needed to serve a standard 80% LVR mortgage has dropped over the past 10 years.
Source Here: Housing Affordability Now Improved
