Get Me Downunder

The Adventure Starts Here

Australian Homes Most Affordable in 5 Years

THE Australian dream of owning a home is more affordable now than it has been for five years following lower interest rates and greater Government subsidies, a report says.

The Housing Industry Association and Commonwealth Bank First Home Buyer Affordability index improved by 39.2 per cent to 153.6 points in the December quarter from 110.3 index points for the September quarter.

First home buyers last had housing this affordable in the March quarter 2003, according to the index.

HIA chief executive Chris Lamont said lower mortgage rates and the boost to the first home owners scheme made it easier to buy a house.

“For would be first home buyers, conditions have improved significantly and clearly many Australians are taking up the opportunity to get into home ownership,” Mr Lamont said in a statement.

“Cuts with interest rates and the first home owners grant have made a large impact.”

The Reserve Bank of Australia (RBA) lowered the cash rate by three percentage points to a six-year-low of 4.25 per cent in the last four months of 2008.

And the central bank cut the cash rate another one percentage point to a 45-year-low of 3.25 per cent on February 3 in a bid to cushion the domestic economy from a possible recession.

Commercial banks have lowered their standard variable mortgage rates by an average 3.75 percent points in response since September last year.

Repayments on an average home loan fell by 26 per cent to $2,056 a month by the end of the December, from $2796 the previous quarter.

In mid-October, the Federal Government doubled the first home owners grant to $14,000 for established dwellings and tripled it to $21,000 for newly built homes until June 30.

Households would need an income around $70,000 to buy a modest home, the report said.

“Previously, a household would have to be earning in the order of $85,000 to afford a modestly priced home without going into severe mortgage stress,” Mr Lamont said.

“The improvement in housing affordability means those on a more modest income can now contemplate a home of their own.”

Buying a home was more affordable in all capital cities and regional areas during the December quarter, the report said.

Views: 26

Add a Comment

You need to be a member of Get Me Downunder to add comments!

Join Get Me Downunder

Job of the Week

Provided by Working Downunder


Scan the code with your phone to join our Jobs Down Under list

© 2021   Created by Australia & New Zealand magazine.   Powered by

Badges  |  Report an Issue  |  Terms of Service