The Real Estate Institute of Australia (REIA) has issued the Housing Affordability Report for the December 2023 quarter.
Nationally, the average household is paying 47.7% of their income towards mortgage payments. As a guide, you want your mortgage payments to be around 25% - 30% of your income. Similarly, when rental agents assess affordability on a rental application, they also use these percentages. However, we have seen substantial increases in both rent and mortgage repayments in recent years.
It is truly a season of trials for Australians and it's more important than ever to be disciplined with our income, strict with our budget, and compassionate with those around us. The pain of not just the housing crisis, but the cost of living has not fallen proportionately on everyone. We are all prayerfully awaiting news of the first-rate decrease since the non-stop increases began. It may still be a while away but will be welcomed by many.
While we are all aware that we are in the midst of a housing affordability crisis, some silver lining did come with this report with First-home buyers increasing yet again with 31,445 homes sold to first-home buyers. Because these new homeowners had to prove they could afford repayments at a rate 3% higher than their actual interest rate, it shows hope for those who have a goal to one day own their own home. If over thirty-one thousand people can buy their first home during such a crisis, the Australian dream is far from dead.
It's easy to give into the gloom of the news. After all, horror stories get the most clicks. However, I see first-home buyers every day and most of them don’t have family who can help. It may not be a home in central Sydney however it’s theirs!
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