Australian housing affordability continues to climb through June quarter
Housing affordability continued to increase during the June quarter of 2013, further perpetuating the real estate recovery and increasing consumer confidence for anyone interested in buying a home in the near future.
The latest Housing Industry Association and Commonwealth Bank Housing Affordability Index highlighted a 4.4 per cent increase over the quarter.
According to Harley Dale, chief economist for the HIA, the increase can be attributed to improvements across the capital cities and non-metro areas during the latest quarter. This leaves housing affordability 16.7 per cent higher than it was in mid-2012.
All seven capital cities experienced an increase on the Affordability Index, with the strongest quarterly increase occurring in Brisbane, increasing by 10.4 per cent. This was followed by Hobart (10 per cent), Adelaide (7.7 per cent), Canberra and Perth (4.1 per cent), Sydney (3.3 per cent) and Melbourne (2.2 per cent).
Outside of the capital cities, affordability also increased across the six non-metro regions. Queensland experienced the largest increase with a rise of 9.6 per cent, followed by Tasmania (8.1 per cent), South Australia (7.7 per cent), Victoria (5.3 per cent), Western Australia (4.5 per cent) and New South Wales (2.9 per cent).
"These are certainly encouraging results for those entering the market at this time in the cycle," said Mr Dale in an August 28 release.
However, Mr Dale cautioned that these changes in affordability weren't necessarily representative of dwelling prices changing, but rather indicative of changes to the lending rates in Australia.
With the Reserve Bank of Australia's decision earlier this month to reduce the nation's cash rate to a historically low 2.5 per cent, interest rates for lending have decreased while confidence in the market is beginning to climb.
"Genuine, structural improvements to affordability are contingent on a stock of housing supply that grows commensurately with the population and its housing needs," said Mr Dale.
"Policy reform, led by the Federal Government, needs to be implemented to drive a sustained improvement to residential construction so as to genuinely address the housing affordability challenge in Australia."
However, now could be the perfect time to take advantage of the market to secure residential real estate, regardless of whether you're a first home buyer or looking to purchase an investment property.
Getting in contact with a real estate professional will help you to find the perfect property for your needs, streamlining your real estate experience and facilitating your home buying success.