Invest
How much time do you need to raise a house deposit?
Half a year has been cropped off the time Aussies need to raise a house deposit as a result of a rapid increase in housing affordability, which pursued significant declines in median house prices in Sydney and Melbourne.
How much time do you need to raise a house deposit?
Half a year has been cropped off the time Aussies need to raise a house deposit as a result of a rapid increase in housing affordability, which pursued significant declines in median house prices in Sydney and Melbourne.
The Australian housing market featured diverse changes in the affordability of both housing deposits and repayments in certain cities in the third quarter of 2020, as the market adjusted to the impacts of the COVID pandemic, new research by a local conservative think tank showed.
Figures published by the Australian Institute for Progress revealed a drop in the total number of weeks it takes to raise a deposit, with the national average now sitting at 764.9 weeks, having decreased by 8.9 weeks over the September quarter.
In Sydney, a $21,000 drop in house prices saw the time required to raise a deposit shrink by 23 weeks. Similarly, in Melbourne this number was brought down by 22 weeks following a price decrease of $20,000.
Deposits also dropped in Hobart where the median house price shrunk by $9,700, but rose in Brisbane, Adelaide, Darwin, Canberra and Perth, where house prices clocked increases.
On the back of the AIP’s research, executive director Graham Young said: “The least affordable city is Hobart, followed by Canberra, Melbourne and Adelaide. Most affordable is Perth, followed by Brisbane and then Sydney.”
On Friday, RBA governor Philip Lowe has said that the Reserve Bank is not responsible for targeting house prices, after questions were raised about the creation of a raging bull market against the backdrop of low interest rates.
“The RBA does not, and should not, target housing prices. Instead, our focus is on the lending that is used to purchase housing,” Dr Lowe said in front of Parliament’s standing committee on economics on Friday.
Questioned about the point at which the RBA will act to prevent the creation of “unsustainable prices”, Mr Lowe reiterated that the issue for the central bank would be if people didn’t borrow sensibly.
“We shouldn’t try and control asset prices,” the governor said.
According to analysts, the record-low interest rate will send property prices soaring.
Shane Oliver, chief economist at AMP Capital, expects that the RBA’s decision to keep interest rates at 0.1 of a percentage point will leave mortgage rates at record lows, which, along with government home-buyer incentives and economic recovery, will continue to push average property prices higher.
“Headline inflation will rise due to base effects as the collapse in petrol prices and childcare costs drops out of annual comparisons, but underlying inflation will remain low at around 1.5 per cent or less out to next year,” Mr Oliver said.
“This, in turn, will see the RBA leave rates at 0.1 [of a percentage point] probably out to end 2022 at least.”
About the author
About the author
Property
Why it now costs 130% more to service a mortgage than 3 decades ago
The lifetime cost of owning a home has increased by over 130 per cent in just three decades, new research has revealed. ...Read more
Property
Using the 30/30/3 rule for home buying during uncertain times
Thinking of buying a home? Uncertain economic times may have you double guessing your purchase, but the 30/30/3 rule can help you make this a reality. ...Read more
Property
Rental yields reach decade high, but not all markets move at the same pace
Changing consumer preferences towards lifestyle destinations and a lack of supply have led to record national price growth, albeit price fluctuations vary region-to-region, fresh figures show. ...Read more
Property
What younger Australians are getting wrong about home loans
As young Australians look to fight the odds and take their first step onto the property ladder, more and more are making easy mistakes. ...Read more
Property
More than 1 in 3 Aussie properties are cheaper to buy than rent
Having a mortgage is even more likely to be cheaper than renting than it was pre-pandemic, new research has revealed. ...Read more
Property
How will the moratorium on evictions impact landlords and tenants?
The NSW government has announced a 60-day moratorium on evictions, with landlords gifted incentives to reduce the burden on COVID-19-affected tenants. ...Read more
Property
Young renters cry out against ‘lack of respect’ in rental market
Young Australians have expressed dismay over the perceived discrimination within the rental market as the wealth divide forces them into long-term renting. ...Read more
Property
Note investing: A way into the property market for younger Australians?
As the traditional route into the housing market becomes more difficult, could unorthodox alternatives like note investing bridge the gap? ...Read more
Do lockdowns boost property prices? Are short-sellers levelling the playing field? Did you lodge your tax returns early?
Listen now
Will lockdowns halt the housing boom? Is the metaverse taking over? And the cons of lodging your tax returns early
Listen now
Are you being priced out of the market? Have you got the Tuesday blues? And are you ready for the upcoming super changes?
Listen now
Are property prices set to crash? Should you jump on board the fintok craze? And how to prepare for this tax time
Listen now
Property
Why it now costs 130% more to service a mortgage than 3 decades ago
The lifetime cost of owning a home has increased by over 130 per cent in just three decades, new research has revealed. ...Read more
Property
Using the 30/30/3 rule for home buying during uncertain times
Thinking of buying a home? Uncertain economic times may have you double guessing your purchase, but the 30/30/3 rule can help you make this a reality. ...Read more
Property
Rental yields reach decade high, but not all markets move at the same pace
Changing consumer preferences towards lifestyle destinations and a lack of supply have led to record national price growth, albeit price fluctuations vary region-to-region, fresh figures show. ...Read more
Property
What younger Australians are getting wrong about home loans
As young Australians look to fight the odds and take their first step onto the property ladder, more and more are making easy mistakes. ...Read more
Property
More than 1 in 3 Aussie properties are cheaper to buy than rent
Having a mortgage is even more likely to be cheaper than renting than it was pre-pandemic, new research has revealed. ...Read more
Property
How will the moratorium on evictions impact landlords and tenants?
The NSW government has announced a 60-day moratorium on evictions, with landlords gifted incentives to reduce the burden on COVID-19-affected tenants. ...Read more
Property
Young renters cry out against ‘lack of respect’ in rental market
Young Australians have expressed dismay over the perceived discrimination within the rental market as the wealth divide forces them into long-term renting. ...Read more
Property
Note investing: A way into the property market for younger Australians?
As the traditional route into the housing market becomes more difficult, could unorthodox alternatives like note investing bridge the gap? ...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.
