Core Logic-RP Data’s Cameron Kusher has posted a somewhat depressing article on the difficulty of finding an affordable home in Australia’s capital cities.
According to Kusher, there is next to no chance of finding a home for under $200,000 in a capital city, and only limited options finding a home valued between $200,000 and $400,000:
51.2% of regional suburbs have a median value of between $200,000 and $400,000 compared to 15.4% of capital city suburbs. Similarly just 0.6% of capital city suburbs have a median house value of less than $200,000 compared to 13.1% of regional suburbs. There is no value band that shows a clear majority across the combined capital cities however, the 33.1% of suburbs with a median value of between $400,000 and $600,000 is the band with the greatest share of suburbs.
Even for units, only 1.7% of suburbs in capital cities are valued below $200,000, with 41.2% of suburbs valued between $200,000 and $400,000:
Obviously, Sydney and Melbourne are in a league of their own, with no suburbs having a median house or unit value of less than $200,000, and minimal options between $200,000 and $400,000.
Kusher concludes with the following observation:
The data shows that particularly in our larger capital cities there is a critical undersupply of affordable housing options (even in the unit market). As a result an increasing number of residents are being locked out of home ownership or are being forced to purchase outside of the cities. Remember that although job prospects are generally better in the larger capital cities the difference in average wages across the capital cities is nowhere near as large as the differences in home values.
Obviously, the dearth of affordable housing options for FHBs and essential workers, like nurses and teachers, is a major issue for both equity and the economy.
It also highlights the egregiousness of Prime Minister Malcolm Turnbott’s opposition to property tax reform, along with his cheering-on of higher house prices.
I guess when you own many investment properties, self interest takes precedence over the national interest and inter-generational equity.
