More properties under $500K up for grabs
There was a sharp rise in the number of properties priced at less than $500,000 in 2011, according to new data from realestate.com.au.
The listings website reported that there was 23,000 more properties listed under this price last year when compared to 2010.
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This was despite the results of a February survey by research company Pure Profile which found that 77 per cent of first home buyers believed they are being forced out of the market.
Property expert Margaret Lomas said realestate.com.au’s data exposes the myth that property wasn’t affordable.
While some suburbs and capital cities are unaffordable, she said there are alternatives, particularly in suburbs on the edge of metropolitan areas and in regional centres.
“I see many first home buyers entering the property market on a lower rung, as investors first,” she said.
“While many of the more exclusive suburbs of capital cities are indeed unaffordable to the first home buyer, considerable affordability can be found in outer suburbs with excellent infrastructure and in larger regional areas which offer diverse employment opportunities and an excellent lifestyle.”
According to the most recent statistics from RP Data, all capital cities have a median house price below $500,000.
Data from the Real Estate Institute of Australia (REIA) showed a modest improvement in housing affordability in the December quarter of 2011.
“The increase of 1.1 per cent in the median weekly income and the decrease of 0.9 per cent in average monthly loan repayments explain the 0.7 percentage point decline in the proportion of family income required to meet loan repayments over the quarter,” REIA president Pamela Bennett said in relation to the affordability data.
Ms Lomas said the belief that property prices are currently overvalued had been perpetuated by sensational headlines that consider affordability only in relation to yearly household income, which was inaccurate.
“We are at a time when housing is the most affordable it has been for a decade,” Ms Lomas said.
“From a peak of 34 per cent of the average household income in 2010, average mortgage payments on the median priced home have declined to 32 per cent and are expected to fall beneath the long term average of 30 per cent by early next year.”