Housing Affordability improves in September quarter

HOUSING affordability continued to improve across Australia in the September quarter, but New South Wales remains the country's most difficult state to meet home loan repayments.

The latest REIA Housing Affordability Report showed the proportion of income required to meet loan repayments fell by 0.5% to 30.4% during the September quarter.

NSW homebuyers are paying 4.1 percentage points of their wages more than the national average to meet their repayments.

The Reserve Bank's holding of the cash rate at 2.5% all year so far - one of the longest periods of interest rate stability in Australia's history - has helped prop up the figures.

REIA chief executive officer Amanda Lynch said many states and territories' removal of first home buyer grants for established dwellings was disappointing.

"Especially when new research suggests that first home buyers are becoming more burdened with debt and increasingly using personal loans and credit cards to finance their deposit," she said.



- The average loan size to first home buyers increased by 9.1% compared to the same quarter last year

- NSW remains the least affordable place to buy a home


- 26.4% of all Australian first home buyers in the last quarter were from Victoria.


- Housing affordability in Queensland remained unchanged over the quarter despite improvements in all other states.


- South Australia recorded the largest quarterly drop in the number of first home buyers nationally following the removal of the first home buyers grant for established homes.


- First home buyers made up 20.7% of Western Australia's owner-occupier market during the quarter - the largest proportion of across the country

- 25.1% of all Australians first home buyers were from WA.


- The average loan size to first home buyers in Tasmania decreased over the quarter by 5.2% to $213,233. In comparison, in NSW, the average first home buyer loan is $327,767.


- Northern Territory saw the largest jump in the number of loans over this last quarter and also this past year.


- The Australian Capital Territory continues its long run as the most affordable state or territory in which to buy a home or rent