Mortgage burden eases slightly for Australian families

New South Wales remains the most challenging state to have a mortgage, according to the Housing Affordability Report, which was produced by the Real Estate Institute of Australia and Adelaide Bank.

Families in NSW needed 35.3 per cent of their income to pay their mortgage – a slight deterioration from the 35.2 per cent figure recorded the previous year.

Repayments also became harder in Victoria, which worsened from 31.6 to 32.2 per cent, and Western Australia, which moved from 26.5 to 26.6 per cent.

However, families living in the other states and territories found it easier to pay their mortgages.

Queensland improved from 28.9 to 28.1 per cent and Northern Territory from 28 to 27.7 per cent.

South Australia moved from 27.8 to 27.1 per cent, Tasmania from 26.2 to 25 per cent and ACT from 21.1 to 19.8 per cent.

Meanwhile, Real Estate Institute of Australia president Peter Bushby has sounded an alarm about first home buyer activity in the Housing Affordability Report.

“In what is becoming a very concerning trend, first home buyer levels continue to be at near record lows, making up only 12.7 per cent of the owner-occupier market during the quarter compared to the long-run average proportion of 19.7 per cent,” Mr Bushby said.

“Many in the sector report that affordability is a perceived barrier for first home buyers who view property prices are close to or beyond their means – or worryingly, home ownership is seen as completely cost-prohibitive.”

Adelaide Bank’s general manager of third-party lending, Damian Percy, said he shared Mr Bushby’s concerns.

He said an improving economy would put pressure on housing supply and prices unless governments, developers and lender worked together to solve the problem.

[Related: Exploding the myth of housing affordability]