Rising home values and increasing borrowing costs have seen housing affordability decline by more than 30 per cent over the past year.
According to the latest HIA-CBA Housing Affordability Report, affordability fell by 9.1 per cent in the June quarter across capital cities and 6.7 per cent in regional markets.
The decline brought the annual index result, which combines interest rates, household incomes and home prices to determine affordability, down 32 per cent compared to the same period last year.
“As housing affordability slips away, so too does the chance for many Australians to realise their dream of owning a home,” HIA chief economist Harley Dale commented yesterday.
He continued that substantial federal government engagement in addressing housing affordability was urgent.
“There has been a dire lack of commitment in this federal election campaign to address the substantial hurdles aspiring home owners face. Helping Australians afford a roof over their head is surely a fundamental responsibility of government,” Harley Dale added.
According to the HIA-CBA Index, the largest falls in affordability were recorded in Sydney (-9.1 per cent), Regional Victoria (-9.0 per cent), Regional Tasmania (-8.8 per cent), and Adelaide (-8.7 per cent). “Key federal policy priorities need to include a program to reduce new housing costs such as inequitable taxes and charges, better planning approvals systems, and a dedicated federal housing and development ministry to coordinate policy across all sectors and levels of government,” Mr Dale said.
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