Australia’s most affordable housing markets have been revealed in the latest HIA Affordability Index.
Covering the December quarter of 2018, Australia’s capitals scored an average of 75.4, which is 1.5% higher than the previous quarter and 3.3% higher when compared to the same quarter in 2017.
However, six capitals scored higher than the average, with the national benchmark lowered by Sydney and Melbourne, which both demonstrated gains in affordability.
Surprisingly, Sydney topped the affordability table for the quarter, with its rating increasing by 11.3%, followed by Melbourne which saw a gain of 5.9%.
They were followed by Perth (+5.7%), Darwin (+3.2%) and Brisbane (+0.8%), which have all seen affordability improve over recent months.
The top three least affordable markets are Hobart, Canberra and Adelaide, which saw declines in their overall affordability of 9.3%, 3.6% and 3.3% respectively.
“The strong flow of new housing supply is one of the key factors behind the moderation in price pressures in housing markets across the country, which has ultimately improved housing affordability,” said Geordan Murray, HIA Senior Economist.
Hobart, Tasmania, was one of only two locations to post a result below its 20-year average, demonstrating the heat in the market.
Earlier in January, Tasmania’s Lutana and Mornington suburbs were named the nation’s fastest selling, with properties sold after an average of six days. However, interstate migration and a nation-wide publicity campaign to attract more young people, has seen prices rise across the state, leaving many Tasmanians locked out of the market.
Commenting on the report, Murray added, “2018 was the fifth consecutive year where the industry commenced construction on more than 200,000 new homes and it was a record year in terms of new dwelling completions.
“The combination of declining home prices, growth in wages and historically low interest rates creates a situation where the HIA Affordability Index shows that affordability in six of the eight capital cities is more favourable than the 20-year average. Melbourne and Hobart are the only exceptions,” he added.