Expense of housing exaggerated: Rismark
By
Andrea Lavigne
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22/01/2010 9:35:00 AM
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4
comments
Australian housing is not as expensive as is commonly believed, says Rismark International.
The real estate group developed a new housing affordability index which compares Australian dwelling prices with the RBA's definition of national "disposable household incomes" over time.
The quarterly Rismark National Dwelling Price-to-Income Index, which was released for the first time today, revealed that Australian house prices have not risen relative to disposable household incomes since late 2003.
Christopher Joye, Managing Director of Rismark International said that the fact that there has been no discernible increase in Australian house prices relative to disposable incomes since the end of the last boom in 2003 is one important explanation for the exceptionally resilient performance of Australia's housing market during the GFC.
"In contrast to claims that Australian house prices are 7-8x incomes, Rismark's National Dwelling Price-to-Income Index implies that the true ratio across all regions and all property types is around half this estimate."
"This suggests that Australian housing is not as expensive as is commonly believed. It
also reconciles with RBA analysis highlighting Australia's internationally low mortgage default and mortgage stress rates," Joye said.
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Latest Comments
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4
comment(s)
Dave on
22 Jan 2010 12:36 PM
Thats right, if you don''t agree with the figures given by existing indicators...make up your own indicator to reflect your view. Gotta love it!
James on
22 Jan 2010 01:54 PM
What a load of rubbish. Average income 55k, average house in NSW 500k. 9x income. I''m betting on the property crash occuring 2nd half 2010.
John on
22 Jan 2010 01:54 PM
Yes, have to agree with Dave
It is such a pity that there is no ramifications for the spinners of such information. They know they will get away with it, and if in the meantime it increases business, well fantastic.
Just remember, if they make money of it, then everything they say should be taken with a grain of salt. Watch the rest of the property spruikers talk this up.
Wayne on
22 Jan 2010 04:20 PM
Dear Dave, James and John, the 3 prophets of acopalyptic property doom. Take a chill pill guys. Both "sides" of the property debate can present statistics to justify their position so I''m confused by your comments. Are you saying only ''pro property'' commentators can use stats to justify their position? Spare me. Either way, any strident argument only proves that if you''re convinced of a certain view nothing to the contrary will pursuade you, i.e. if you believe it to be true (or false) then so it is for you. Wouldn''t you agree with me that results speak for themselves? Proof is in the pudding James, so what''s your bet? Are you selling any property you hold or will you defer any purchase until prices fall? By what % do you expect (Sydney?) prices to fall in 2010? I''ll even let you choose the provider of the statistics. In the meantime, I''m a happy Qld property investor. Cheers friends.