Western Australia is still the most affordable state in the country for housing, despite house prices rising about 14 per cent in Perth this year, according to Real Estate Institute of Australia’s latest Housing Affordability report.
The report determines affordability based on what proportion of the median weekly family income is required to service loan repayments and pay rent in the respective state or territory.
The latest report for the September 2021 quarter found that WA was, once again, the most affordable state to buy in, with only the Northern Territory and Australian Capital Territory more affordable. WA is also the most affordable place to rent in – equal with Victoria.
The proportion of family income required to service loan repayments in WA during the September quarter was 26.3 per cent, an improvement of 0.1 per cent on the June quarter.
WA was the only state to record an improvement in housing affordability during the quarter, with every other state recording declines. The NT recorded no change in affordability, while the ACT also saw a 0.1 per cent improvement.
New South Wales required the largest proportion of family income to service loan repayments during the quarter at 44.7 per cent.
In a testament to how affordable our local market is, WA, once again, had the largest percentage of first homebuyers in its owner-occupier market at 42.4 per cent.
It was more affordable for first homebuyers to purchase a home in WA during the September 2021 quarter than the June 2021 quarter, with the report showing the average loan taken out by first homebuyers reduced by 0.6 per cent to $365,815.
In the rental market, although affordability in WA experienced a 0.2 per cent decline, the report showed WA and Victoria were the most affordable places in the country to rent in, with both requiring 19.8 per cent of the average income amount to pay their rent. To put that figure into perspective, in Tasmania the proportion of income required to pay rent was 29.7 per cent.
Even though WA property market conditions are strong, it is pleasing that our local market remains accessible for most Western Australians.