Western Australia has remained the most affordable place for buyers and renters despite rising costs, according to a report from the Real Estate Institute of Australia (REIA).
The report found that the share of income needed to meet in-state loan repayments increased from 23.9% to 24.8% in the three months to December. The share of income allocated to median rent also fell from 17% to 17.8%.
The boom in first-time homebuying activity reflects the affordability of Western Australia relative to other states. Indeed, segment activity soared to 7,166 in the December quarter, a quarterly increase of 41.6% and 97.1% per year. The segment accounted for 50.4% of the state's homeowners. Overall, 15.7% of all first-time home buyers across the country are in the state.
The average first-time homebuyer loan increased 5.7% in the December quarter to $ 360,675, 4.1% higher than the quarter from December 2019.
Adrian Kelly, president of REIA, said the decline in affordability was largely due to rising house prices and larger loans.
"The market has defied doomsday forecasts, with median home prices rising across the country in 2020, with demand driven primarily by first-time homebuyers," he said.
However, Kelly said the growing demand could potentially pose a challenge for affordability.
"This trend of converting to homeownership is great news given the challenges many tenants and investors faced during the pandemic. However, soaring house prices could see soaring home prices. Housing affordability wiped out unless measures to improve supply are implemented. This particularly applies to regions certain parts of Australia, "he said .
Top suburbs:
new city
,
Padbury
,
Westmead
,
upper kedar
,
North Lambton
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