Housing Affordability Declines Further in 2024

Australia's housing market continues to present challenges for both buyers and investors, as rising property values and rents consistently outpace income growth. The 2024 ANZ-CoreLogic Housing Affordability Report paints a difficult picture, showing that affordability metrics have reached record lows. For many families, this makes securing housing or expanding their property portfolios more difficult than ever.

A Closer Look at the Market

                                                                                                                                                                                        The latest figures highlight the severity of the situation:

• The national median dwelling value is now $807,000.
• Weekly rents have increased to $642.
• The average household would need over 10 years to save for a 20% deposit.
• Only 10% of the housing market is affordable for median-income households, a sharp drop from 40% in 2022.

Even high-income earners aren’t immune, with just half the market now accessible to households earning $172,000 annually. These numbers reveal a tough reality for many Australians, whether they’re looking to buy their first home or expand their property portfolio.

Navigating the Challenges

Despite the tough market conditions, it’s still possible to find a path forward. Here are a few ways to manage the current challenges:

1. Understanding Your Budget and Financing Options
   It’s important to realistically assess your financial situation. Understanding your budget and the options available to you is the first step in making the homebuying process manageable.
2. Exploring Government Support
   For first-time homebuyers, government programs and grants can provide much-needed financial relief. These initiatives are designed to help make housing more accessible by reducing upfront costs.
3. Saving for a Deposit
   Saving for a home deposit can feel overwhelming, but it’s essential to start with a clear strategy. Setting realistic goals and exploring different savings methods can help you reach your deposit target more effectively.
4. Expanding Your Search
   While major cities remain expensive, considering emerging suburbs or regional areas may offer more affordable housing options without sacrificing lifestyle. The broader market may hold potential opportunities that are worth exploring.
5. Planning for Ongoing Costs
   Don’t forget to factor in ongoing costs, such as maintenance, property taxes, and utilities, when budgeting for your home. These expenses can add up quickly, so planning for them will ensure you’re financially prepared.

While today’s market is undeniably challenging, it’s important to stay focused on your long-term goals. With the right guidance and planning, achieving homeownership or expanding your property portfolio is still within reach.

At OM Financials, we’re committed to helping you navigate these challenges. Our expert team is here to provide the advice and financial solutions you need, whether you’re buying your first home or growing your property investments. By working with a trusted partner who understands the complexities of the market, you can feel confident in your ability to overcome the hurdles and move forward with your homeownership journey.

You can book your session for free consulting.