Best rental affordability results since 2007: REIA

The REIA Housing Affordability Report (the Report) was released today and shows housing affordability has improved slightly across the country in the June quarter.

REIA president, Adrian Kelly said rental affordability had improved in both the June quarter and the past year.

“The proportion of income required to meet rent payments decreased to 23.3 per cent in the quarter, a decrease of 0.4 percentage points over the quarter and down 0.5 percentage points compared to the same time last year,” said Mr Kelly.

“This can be mainly attributed to the reduction or stabilisation of rents during the June quarter with only the Australian Capital Territory having an increase in rents.

“Rental affordability has not been this high since December 2007, a positive for renters in these COVID times.”

Mr Kelly also said the proportion of household income required to meet loan repayments decreased by 0.2 percentage points to 34.5 per cent over the quarter.

“Even though the family income only increased 0.1 percentage point during the period, the average loan repayment decreased 0.6 percentage points through a drop in the average variable standard interest rate,” said Mr Kelly.

The Report also shows the total number of new loans have declined compared both the March quarter of 2020 and the June quarter of the previous year.

“This is the lowest number of new loans issued in the past 5 years for all areas except New South Wales and the Australian Capital Territory and reflects the reduced activity in the housing market as a result of restrictions associated with COVID,” said Mr Kelly.

About the Housing Affordability Report

The quarterly Housing Affordability Report is recognised as the most authoritative indicator of Australian housing affordability. Subscribers to the Report include state and Federal Treasuries, the Reserve Bank of Australia, academic institutions, financial institutions, libraries, brokers, developers and major consultancy groups.

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