The affordability of housing has improved significantly in Australia, according to the latest report from the Housing Industry Association (HIA).
The HIA Financial Accessibility Index data showed that affordability increased by 2.2% nationally during the March 2019 quarter, This represents the fastest improvement in affordability since 2013. HIA's affordability index is calculated quarterly for each of Australia's eight capitals and regions based . It takes into account the latest housing prices, mortgage interest rates and wage developments.
"The improvement in affordability of housing was found throughout the country, with the exception of Tasmania and ACT, where accessibility remained static, according to Tim Reardon, chief economist at HIA. "The explosion of residential construction over the last five years is a key factor in improving housing affordability. With the completion of new housing remaining at high levels, affordability should continue to improve.
Reardon also pointed out that continued wage growth had contributed significantly to improving affordability, with rising incomes in Sydney and Melbourne having a particularly lasting impact.
"Affordability in Sydney has deteriorated to such an extent that in June 2017, he needed two average incomes to be able to afford repayments from an average home in Sydney. Said Reardon. "[But] in just over a year, the situation has more than required 1.8 standard income to buy the same house. Similarly, in Melbourne, the affordability index has improved by almost 10% in one year. "
Five of the eight capitals saw their financial capacity improved until March 2019. Sydney continued to record the largest improvements, with an index up 12.4%. Then came Melbourne (+ 9.6%), Perth (+ 7.7%), Darwin (+ 5.9%) and Brisbane (+ 2.5%). On the other hand, affordability deteriorated in Hobart (down 5.1%), Canberra (down 5.1%) and Adelaide (down 1.1%). .
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