Good News: Increase in Property Value
Recent data from the Australian Bureau of Statistics (ABS) shows a significant increase in the total value of Australian dwellings. In the past quarter, the total value rose by $29 billion, reaching a new high of $10.7 trillion. However, this is only beneficial for those who already own property.
Bad News: Record High Housing Loans
The average new housing loan for owner-occupiers has reached a record high of $625,091. This amount represents 80% of the median Australian house price, which stands at $785,000.
Affordability Crisis
Servicing these large loans is becoming increasingly difficult. The average monthly salary after tax is $6,500, while the monthly mortgage repayment for the average loan is $4,355. This leaves only $500 per week for all other expenses if there is a single income earner.
Dual Income Families
For families with two full-time working adults, the financial situation is somewhat better. However, the high cost of child care, approximately $5,000, surpasses the mortgage costs, leaving just $873 per week for other essential expenses like utilities, food, and medical bills.
Conclusion
The current financial environment makes home ownership increasingly unattainable for average Australian families unless they earn significantly more than the average wage. The rising property values and record-high loan amounts are contributing to this growing affordability crisis.
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