The proportion of household income required to meet average home loan repayments rose to 38 per cent in the March quarter, the Deposit Power/Real Estate Institute of Australia (REIA) Housing Affordability Report revealed yesterday.
Home loan affordability has now deteriorated by 8.7 per cent in the year to March and is the most unaffordable in the 22 years since REIA began recording data.
Rental affordability is not faring much better; renting families now require 24.7 per cent of the median family income to meet rental payments, compared with 22.8 per cent one year ago.
President of the REIA Noel Dyett warned that affordability would continue to worsen further in the June quarter “as the impact of interest rate rises is fully felt”.
Other significant report findings:
• Renters are worst off in Tasmania, where median incomes are lowest yet rents are relatively high. 29.5 per cent of family income is required to pay rent.
• Renting is more expensive than buying in Darwin; renters require 28.1 per cent of income for renting while buyers require 23 per cent of income for servicing home loans.
• Queensland has replaced New South Wales as least affordable state, with 40.5 per cent of median weekly family income needed to service the average loan.
• South Australia saw the largest decrease in affordability in the year to March of 15.3 per cent. 35.7 per cent of income is now needed to service the average home loan.
• Home loan affordability is best in the ACT where incomes are highest. 22.4 per cent of family income is required to meet average loan repayments.
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