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ISCOVER
By: Belinda Luc
Housing affordability fell again in the March quarter, as higher house prices, increased interest rates, and the removal of the first home buyers’ boost hit home buyers.
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According to the latest HIA-CBA First Home Buyer Affordability Report, housing affordability fell by 4 per cent to 28.7 per cent in the March quarter.
Across the capital cities, affordability fell by 4.2 per cent to 30.5 per cent. Regionally, affordability dropped by 5.3 per cent to 24.8 per cent.
And the problem is expected to worsen over the coming quarter. Housing Industry Association (HIA) senior economist Ben Phillips said interest rate hikes in April and May will force affordability to crash to the record lows experienced when interest rates were above 9 per cent in 2007.
“With the Reserve Bank insistent on further rate rises, housing affordability will once again be a key issue in the mortgage belt regions of Australia,” Mr Phillips said.
“We are yet to see the required level of co-operation between all levels of government to deliver critical housing infrastructure without hitting new home buyers,” he said.
The largest falls were recorded in Victoria (-10 per cent and -15.9 per cent for Melbourne and Regional Victoria respectively), Western Australia (-6.6 per cent and -14.2 per cent in Perth and regional WA) and regional New South Wales (-12 per cent).
