News & Media
Perception of housing affordability on the rise across Australia
26 Sep 13
Research from Australia’s No. 1 property site realestate.com.au has found it’s not all doom and gloom when it comes to Australia’s outlook on housing affordability.
The annual realestate.com.au Housing Affordability Sentiment Index (HASI) has shown the perception of affordability has improved across the country, with this year’s HASI revealing that all states and generations have experienced an increase in their sentiment towards the cost of housing over 12 months. The increase in positivity has been driven by an easing of household expenses and debt combined with increasing household savings.
Driving the surge in positivity in the HASI report have been first homebuyers and Generation Y.
First homebuyers have flooded the market in 2013. The HASI found 46 per cent of the market looking to buy are first homebuyers compared with 28 per cent at the same time in 2012.
Generation Y are the most positive about housing affordability in the country, driven largely by an optimistic outlook on their financial position. 45 per cent of Generation Y respondents expected their financial position to improve over the next six months, significantly more than any other generation.
Highlighting the positivity of this generation, 14 per cent of Gen Y’s surveyed reported they owned an investment property and home, a significant increase on 2012.
Reflective of this increasing positivity, the past 12 months have seen strong growth in Australian property values, with figures showing an increase of 5.4 per cent in home values across the country over the past 12 months. And the most recent auction data, from the week ending 15 September, saw the highest number of auctions since March 2013.
An increase in auctions can sometimes lead to a decreasing clearance rate, but with high levels of demand throughout Australia clearance rates are steady and remain above a very healthy 75 per cent, substantially higher than this time 12 months ago, yet another indication of returning positivity in the market.
Financial commentator and Finance Editor for research and ratings organisation CANSTAR, Justine Davies, said a really encouraging finding from realestate.com.au’s Housing Affordability Sentiment Index was the significant jump in first homebuyers looking to enter the market.
“To me that indicates there is a real feeling now that home ownership is becoming more affordable, in part due to low interest rates that is boosting consumer sentiment,” Davies said.
“As well as low interest rates though, there’s also the fact that Gen Y are getting older, with a greater proportion of Gen Y settling into their careers and, as the HASI found, feeling financially confident. That confidence is translating into a willingness to enter the property market.”
According to realestate.com.au Head of Sales Tom Ainsworth the current market is good news for both buyers and sellers.
“The increasing positivity is great news for sellers and with spring upon us it is a great time to buy. Historically we see the number of listings increase during spring, which gives buyers more choice of property.
“Equally for sellers, high clearance rates and increased positivity means it is a great time to put your home on the market if you are looking to sell,” Ainsworth said.
The report also showed buyers were willing to make sacrifices to achieve the great Australian dream of owning their own home. Consistent with 2012 results buyers were willing to give up luxury items such as swimming pools, luxury cars, and overseas holidays in order to afford a home. However buyers would not compromise on location, 43 per cent of buyers would not consider properties further than 10 km from their ideal location.
realestate.com.au recognises the importance of tracking the sentiment of Australians when it comes to housing affordability. As the market leader, the online property site sees it as a critical step to being able to provide consumers with up-to-the-minute property information to help them realise their dream of home ownership.
For more information on the 2013 HASI findings, and for more tips and tools to assist in searching for property click here.
Or for the fact sheet click here.