Property in Australia becoming less affordable as prices rise and supply falls
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Australian real estate market is regarded as having weathered the world economic downturn well but now concern is growing that rising property prices means that an increasing number of owners are struggling to meet their mortgage payments.
Interest rate increases, lack of supply and high land prices are also adding to the problem. About 16% of property owners were struggling to pay loans in November, up from 11.7% in May, according to a survey from the Mortgage Finance Association of Australia.
‘Recent interest rate increases are negatively impacting households. Confidence in the housing market is not only at pre-global financial crisis, its back to where it was during the height of the housing boom,’ said Phil Naylor, chief executive officer of the MFAA.
The survey also found that some 73% of Australians expect property prices to rise, the highest proportion in more than three years. This compares to 23% of respondents when the last survey was carried out in May 2009.
Australian property prices rose 4.8% in the three months to December from the previous quarter, bringing the national median prices to A$525,524 ($469,398). Prices will rise by as much as 10% this year, according to Australian Property Monitors.
‘Recent interest rate increases are negatively impacting households. Confidence in the housing market is not only at pre-global financial crisis, its back to where it was during the height of the housing boom,’ said Phil Naylor, chief executive officer of the MFAA.
The survey also found that some 73% of Australians expect property prices to rise, the highest proportion in more than three years. This compares to 23% of respondents when the last survey was carried out in May 2009.
Australian property prices rose 4.8% in the three months to December from the previous quarter, bringing the national median prices to A$525,524 ($469,398). Prices will rise by as much as 10% this year, according to Australian Property Monitors.
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