Housing affordability plummets in June quarter

Thursday 5 August 2004

Rising house prices and interest rates in the June quarter caused the steepest decline in home affordability since the December 1996 quarter, the latest AMP Home Affordability Report shows.

By The Landlord

The index declined 7.9 per cent in the quarter with the Auckland region leading the way with an 11.2 per cent decline.

The annual decline in affordability was 8.5 per cent - the eighth consecutive fall in affordability in that series.

AMP said the drop was mainly due to rising home prices. The median price of a home rose 7.4 per cent to $248,000 in the June quarter.

A 1.5 per cent lift in average weekly earnings, was insufficient to offset the rise in house prices and interest rates.

Twice during the quarter the Reserve Bank hiked the Official Cash Rate by quarter of a percentage point. Retail banks hiked mortgage rates commensurately.

Read More - Opens in a new window
Commenting is closed

House Prices

House price drops are short-lived - Alexander

Periods of house price decline are rare and "short-lived", says economist Tony Alexander, amid forecasts of a drop of 10%-15% this year.


Resilience needed in face of change

The Reserve Bank says the commercial property sector is vulnerable to the Covid-19 crisis. But PMG Funds' chief executive believes that while there’ll be short-term pain, the biggest long-term impact will be structural change.


Mortgage lending slumps to record low in April

Mortgage lending fell to its lowest level on record last month as the property market ground to a halt during the Covid-19 lockdown.

Site by PHP Developer