Housing remains to be as affordable since it was a decade ago

THIS home at Oakdale Rd, New Norfolk recently sold for $316,000. It can be a single of Australia’s most economical suburbs.

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DESPITE what many buyers may think, new research shows Australian homes remain as affordable as they were about ten years ago.

Analysis by CommSec chief economist Craig James has revealed that home values are four times household disposable income.

He explained this ratio was broadly unchanged from your decade ago.

“During the last decade disposable income per household has risen around 70 percent while the

average home price has lifted around 67 %,’’ he said.

“Home values could be up, but so might be disposable incomes,’’ he explained.

Mr James said Australians had become richer with time plus the past decade, incomes had grown slightly faster than home values.

“But broadly over the decade little has changed with regard to home affordability - it offers gone

sideways,’’ he was quoted saying.

He was quoted saying certainly people spent much more about homes coupled with bigger and better homes than they did ten years ago, in order that they thought housing was less affordable.

But he explained once you checked out it from your purely financial ratio, things had not changed much.

“Certainly homes are less affordable than 20 years ago, but that's not because income growth has been sluggish, but because wealthier Australians, using lower interest levels, and benefiting

from more affordable basic necessities like food, clothing and transport, have channelled extra dollars into the family home.

“Homes are bigger and also top quality than twenty years ago.’’

Mr James said the latest figures through the RP Data/Rismark Home value index showed the median cost of a home across Australia, was $450,000.

The Australian Bureau of Statistics national accounts estimate of disposable income per household was $111,919.

“Within the last few year the median home price rose by 5.9 %, outpacing the 1.7 per cent lift in income per household,’’ Mr James said

“But interestingly within the last decade, the standard income per household has risen by 70.6 per cent, outpacing a 66.7 % lift in home prices.’’

Based on RP Data, lots of Australia’s least expensive suburbs come in South Australia, Queensland or Tasmania.

It found Elizabeth Vale, in Adelaide was Australia’s most inexpensive capital city suburb.

The northern Adelaide suburb has a median property valuation on $143,452.

Recent sales include, 21 Rollison Rd, Elizabeth Vale which sold for $195,000.

21Rollison Rd, Elizabeth Vale has four bedrooms and ducted air conditioning. Picture: realestate.com.au Source: Supplied

Nearby Elizabeth North was your second most economical suburb with a median property price of $159,438. The suburb was established with the South Australian Housing Trust in 1955.

Recent sales include 11 Chirton St, Elizabeth North which sold for $142,500.


The timber-frame home at Chirton St, Elizabeth North has three bedrooms.Source: Supplied

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