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Staff Reporter
The December quarter of the Adelaide Bank/REIA Housing Affordability Report has found that housing affordability continued to improve slightly.
“All Australian states recorded an improvement, with Queensland and South Australia leading the way – both now 3.5 per cent better – in terms of affordability since the December quarter a year ago,” Adelaide Bank general manager Damian Percy said.
“First home buyers are on the rise in South Australia, WA, Tasmania and the Northern Territory and my conversations with Adelaide Bank’s broker network also reveal that enquiries are on the increase nationally for people wanting to upgrade their home.
“The improvement in affordability has come about due to the combination of interest rates hitting their lowest point in more than 50 years in real terms and an increase in national median weekly family income of 2.2 per cent to $1,616 over the quarter.
“Buyers and upgraders are again emerging, which in turn is generating interest in some of the less restrictive ‘bridging style’ finance options that Adelaide Bank offers. Mortgage brokers are looking for tight turnaround times, particularly in the more active property markets.”
Between the September quarter and the December result, the average loan size increased by just over $5,000, with the average first home buyer loan increasing by just $130 over the September quarter's figure.
According to Mr Percy, this suggests that entry price points are being carefully considered by new housing market entrants.
“New entrants are sticking to tight budgets and they are not prepared to take on any more debt than they absolutely have to,” Mr Percy said.
“In short, this appears to be conservative behaviour reflecting uncertain times for now.”
