Home affordability slips
Housing affordability across WA has slipped as property prices lift and wage growth slows.
The Adelaide Bank-Real Estate Institute of Australia measure of affordability in WA slipped by almost a full percentage point in the December quarter.
Despite the drop, affordability improved over the full year.
Median weekly family income lifted by $23 through the quarter.
At the same time, the average monthly loan repayment lifted by $70. It is now higher than it was a year ago.
The average loan lifted by almost $12,000 through the quarter to stand at almost $338,500.
Overall, it meant a person buying into the WA market had to pay out 26 per cent of their family income to meet their loan repayments.
Nationally, affordability fell by a full percentage point.
The least affordable property market remains NSW where 35.6 per cent of family income is needed to meet mortgage repayments.
The most affordable is the ACT where 20.2 per cent of family income will meet a median mortgage.
The report found first time buyers are being squeezed out of the market even though unaffordability levels are well short of the highs reached before the Global Financial Crisis.
Adelaide Bank general manager Damian Percy said there were real risks developing for a generation of young people.
“We know that owner-occupier first home buyers are staying away from the property market in droves and have been for some time,” he said.
“In spite of a benign interest rate environment, on current statistics, a historically low number of Australians do not seem to feel they are in a position to step onto the first rung of the property ladder. With a view to the future, I can’t see this playing out well,” he said.
