The latest Housing Industry Association (HIA) report indicates that there has been a steady improvement in housing affordability during the opening months of 2017.
HIA senior economist, Shane Garrett in a statement said that during the March 2017 quarter, the HIA Affordability index improved by 1.9 percent – and is 1.2 percent better than this time last year.
“The improvement in affordability is mostly due to a reduction in the national median dwelling price during the March 2017 quarter,” Garrett said.
“Despite these latest results, housing affordability remains a significant challenge. There are good ways to improve affordability – and bad ways. The right approach to tackling affordability is through continuing to secure the delivery of an appropriate supply of new homes and to reduce the barriers and costs involved in doing this.
“With respect to delivering better housing affordability outcomes over the longer term, this week’s comments by the Treasurer in relation to leveraging private investment for affordable housing stock are very welcome,” he said.
The largest improvement in housing affordability during the March 2017 quarter occurred in Perth (+5.6 percent), followed by Hobart (+5.3 percent) and Sydney (+5 percent).
Smaller gains in affordability affected the markets of Brisbane (+0.6 percent) and Melbourne (+0.4 percent).
Of the capitals where affordability declined, the biggest fall was in Canberra (-7.2 percent) followed by Adelaide (-4.0 percent) and Darwin (-0.1 percent).
The HIA Affordability Index results for the March 2017 quarter indicate that conditions are most challenging in Sydney, which has the lowest score (57.5), followed by Melbourne (70.7) and Canberra (78.5).
State by State Affordability Index
The term ‘housing affordability‘ refers to the relationship between expenditure on housing(prices, mortgage payments or rents) and household incomes. More info here.