Housing affordability: Largest annual decline this decade

Australia recorded the largest annual decline in housing affordability since the beginning of the decade, according to the Real Estate Institute of Australia (REIA).

The REIA reported that the proportion of income required to meet loan repayments increased 5.8% in the year to September 2010 across the nation.

Rental affordability also worsened over the September quarter across all states and territories – except for Western Australia and the Northern Territory – compared to the same time last year.

Despite being the least affordable state or territory in the country, rental affordability in New South Wales remained steady. Across both the June and September quarters, the proportion of income required to meet median rent payments remained at 27.3%, increasing by only 0.3 percentage points over the full year.

New South Wales also recorded the highest number of loans to first-home buyers in the country – despite experiencing the largest decrease overall. Over the year, first-home buyer loans in New South Wales decreased 54.5%.