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Rental affordability has reached a new record, according to new figures released by the Real Estate Institute of Australia.
The REIA’s Housing Affordability Report has been released this week, showcasing that rental affordability improved in both the June quarter and when compared year-on-year.
“The proportion of income required to meet rent payments decreased to 23.3 per cent in the quarter, a decrease of 0.4 percentage points over the quarter and down 0.5 percentage points compared to the same time last year,” REIA president Adrian Kelly said.
“This can be mainly attributed to the reduction or stabilisation of rents during the June quarter, with only the Australian Capital Territory having an increase in rents.
“Rental affordability has not been this high since December 2007, a positive for renters in these COVID times.”
Further, Mr Kelly explained that the proportion of household income required to meet loan repayments decreased by 0.2 percentage points to 34.5 per cent over the quarter.
“Even though the family income only increased 0.1 percentage point during the period, the average loan repayment decreased 0.6 percentage points through a drop in the average variable standard interest rate,” he said.
The report also showed that the total number of new loans has declined compared with both the March quarter of 2020 and the June quarter of the previous year.
“This is the lowest number of new loans issued in the past five years for all areas except New South Wales and the Australian Capital Territory and reflects the reduced activity in the housing market as a result of restrictions associated with COVID,” said Mr Kelly.