Housing affordability improves over September quarter

Housing affordability continued to improve in the September 2012 quarter across all geographical areas of Australia, according to the Housing Industry Association (HIA).

The HIA-CBA Housing Affordability Index increased by 5.3 per cent in the September 2012 quarter to be up by 15.0 per cent compared to the same quarter in 2011.

“This is the seventh consecutive quarter where we have seen an improvement in the headline affordability index,” said HIA Chief Economist, Dr Harley Dale. 

“The run of consecutive improvements in some regional indices is even longer, in some instances showing affordability has reached levels not seen since the early 2000s.”

Dr Dale explained that housing affordability has been improving on the back of steadily growing incomes, falling interest rates and easing dwelling prices.

“At the same time, however, transactions volumes have remained historically low as economic uncertainty has weighed heavily on households’ willingness to engage in the residential property market,” he said.

“An increase in home buyer action can occur without generating undue inflationary pressure and would assist a much-needed recovery in new residential construction activity,” concluded Dr Dale. 

While the HIA-CBA Housing Affordability Index confirmed improved affordability across each of the nation’s seven capital cities, the improvements in Australia’s two largest capitals, Sydney and Melbourne, were particularly notable. 

The Affordability index for Melbourne increased by 7.3 per cent over the September quarter, bringing affordability 18 per cent higher than it was in the September 2011 quarter. Meanwhile, Sydney’s Affordability Index improved by 4.4 per cent, to be up by 8.4 per cent compared to the September 2011 quarter.

For more information on residential property prices in your area, please contact your local CENTURY 21 real estate agency.    

Posted by Charles Tarbey on 14/12/2012 at 12:00 AM | Categories:

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