To continue reading the rest of this article, please log in.
Create free account to get unlimited news articles and more!
Figures released by the Real Estate Institute of Australia (REIA) and Adelaide Bank show that the proportion of median family income required to meet average loan repayments was at 32.4 per cent for the quarter – an increase of 0.7 percentage points from the September 2015 quarter.
New South Wales showed the greatest increase in average loan size, up 5.5 per cent over the quarter.
NSW was also the least affordable state for home buyers, with the proportion of income required to meet average loan repayments 7.0 per cent above the national average.
“Rising home loans are largely behind the worsening affordability,” REIA president Neville Sanders said.
“Two states, New South Wales and Victoria, now have average loan sizes exceeding the $400,000 mark.”
The only state or territory to record a decrease in proportion of median family income required to meet average loan repayments was Western Australia, down by 0.4 per cent.
All states and territories, with the exception of Western Australia, recorded increases in first home buyers over the December quarter.
The average loan size for first home buyers increased by 1.8 per cent over the quarter, and 9.2 per cent compared to the December 2014 quarter.
“Declining housing affordability highlights the importance of addressing the supply side issues of affordability,” Mr Sanders said.
“Supply is constrained by a number of longstanding challenges including regulatory and zoning constraints and cost structures including taxing of building.”
[Related: Borrowers on 'a collision course' with banks]