Perth’s new apartment market recorded its strongest quarter of sales since Q4 2021, with 412 apartments sold in Q1 2026 and a record quarterly sold value of $537 million, according to Urbis’ latest Apartment Essentials results.

Urbis said the March quarter result reflects strong, highly product‑specific demand across both ends of the market, from more attainable projects delivering at scale, through to premium stock being absorbed by equity‑rich downsizers.&nbsp;

David Cresp, Partner at Urbis, said the key story in Perth is not demand, it is the market’s ability to convert demand into delivered housing.&nbsp;

“This is the strongest sales quarter since Q4 2021, and it reinforces that demand in Perth is real and it’s local,” David Cresp said. “But the task now is delivery, turning that demand into projects that can actually be built and completed.”&nbsp;

[smartcode_project:default project_id=110291 project_image_fid=302785]

<h2>Affordable product leads, premium demand remains resilient</h2>

Sales in Q1 were led by more affordable projects, with The Boulevard (SKS Group) recording 115 sales in the quarter, the presentation noting this is only the second time a single project has surpassed 100 quarterly sales. The project was able to offer more affordable housing product right next to a train station.&nbsp;

Palmyra West (Finbar) also delivered strong results with 28 sales in Q1, following 84 sales in Q4, with an average price of under $800,000, underscoring depth of demand for well‑located, attainable new stock.&nbsp;

At the premium end, Urbis said downsizer demand is continuing, with the results highlighting Romeo (Applecross, Finbar) recording 75 sales and reaching almost 50% sold in one quarter.

Jual (Shenton Park, Celsius Property) also posted a strong quarter with 28 sales, reaching 39% sold in one quarter.

Urbis noted that Perth apartment demand is not speculative, not investor‑led, and not uniform, describing it as localised, often equity‑driven and highly product‑specific, a pattern reflected in the polarisation between strong “attainable” performers and premium downsizer product.&nbsp;

[smartcode_project:default project_id=148957 project_image_fid=364102]

<h2>Prices underpinned by costs, and the delivery risk is growing</h2>

Urbis said pricing pressure is cost not demand‑driven: construction costs and delivery risk are now a central constraint, with the results noting build costs remain elevated and volatile, and that energy, fuel and labour uncertainty weigh on feasibility.

David Cresp said a growing challenge for private Build‑to‑Sell developers is simply securing a builder in the current environment.

“Developers are really feeling the pressure from a building market that was operating at capacity and securing a builder is challenging,” David Cresp said, adding that even where a builder can be secured, “trying to get to the price that makes the development financially viable is incredibly challenging in the current market.”&nbsp;

Urbis’ broader WA commentary also notes that industry remains at or above capacity with lot and housing creation, and that many builders are limiting new sales to manage stretched workforces and fixed‑price contract pressures, conditions that flow directly into apartment feasibility and delivery timing.

[smartcode_project:default project_id=108869 project_image_fid=317905]

<h2>Supply: improving later, but still constrained, and Perth lags eastern benchmarks</h2>

While near‑term supply remains constrained, Urbis’ forecast shows completions lifting “Supply is forecast to be back above 1,500 apartments per annum for the first time since 2019”, with 1,775 completions forecast for 2026, and volumes remaining above that level over the following years.&nbsp;

Looking further ahead, completions are forecast to reach 2,500 in 2028, with the report noting 32% of that total is social/affordable, reflecting the role of government‑supported delivery in rebuilding the pipeline.&nbsp;

However, Urbis said Perth remains behind comparable markets on pipeline scale. In a national comparison of projects under construction, the report shows under construction Perth Build‑to‑Sell (BTS) at 3,446 apartments versus the Gold Coast at 7,922. Mr Cresp said “The challenge for Perth is how to we grow the delivery pipeline”.

Urbis’ conclusion is that Perth’s market is increasingly defined by product discipline and delivery certainty, with the research identifying “delivery certainty is key” and calling out builder risk and procurement models as core success factors, alongside “timing and staging”.&nbsp;

Joel Robinson

Perth apartment sales hit strongest pace since late 2021 as builder capacity tightens

<a href="https://www.apartments.com.au/developers/sammut-developments">Sammut Group</a> has secured development approval for its latest Brisbane apartment project, marking the Sydney developer’s next step in expanding its Queensland pipeline following the success of its debut Gold Coast development, Coast.

The approved project at <a href="https://www.apartments.com.au/new-apartments/44-glen-road-toowong-qld-4066">44 Glen Road, </a><a href="https://www.apartments.com.au/developments/toowong-qld-4066">Toowong</a> will deliver a 15-storey riverfront apartment building with 42 residences, significantly increasing the scale of the site’s previous approval for a smaller luxury scheme. Designed by Bureau^proberts, the development will comprise a mix of predominantly four-bedroom and two-bedroom apartments positioned to maximise Brisbane River and city views.

Sammut Director Julian Sammut said the group had been actively searching Brisbane for several years before identifying Toowong as the right fit.

“Brisbane was the right step for Sammut,” Sammut said.

“With the success of Coast we thought we should definitely look to do more in Queensland alone. We then pushed up to look at Brisbane. We've been looking for I'd say two to three years actually and it was hard to find the right location.”

<img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_75/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Screenshot%202025-12-23%20at%203.27.14%E2%80%AFPM.png?VersionId=dYAVIL7qdcGA8ojvkslSrLjczXFejSSx" />

Sammut said suburbs including New Farm and Teneriffe were considered before the group ultimately focused on Toowong due to its strong downsizer demographic and limited supply of developable riverfront land.

The site was acquired off-market after what Sammut described as a lengthy negotiation and planning process, with the developer pursuing an uplift to the original approval.

“We are DA approved now which is very exciting,” Sammut said.

“We've had our change approval come through and we've obviously doubled the height, 15 storeys plus rooftop. We've got 42 amazing apartments that are going to be coming to market soon.”

<img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-12-23%20at%203.27.26%E2%80%AFPM.png?VersionId=ohkRkY0dIZlqdfME2EZePsCQavRiBadE" />

Bureau^proberts said the design responds to Toowong’s evolving urban character, balancing contemporary apartment living with the area’s established residential identity.

“A place where traditional Queensland living has taken place for centuries; Toowong is seeing a shift of contemporary influence, commercial and retail hubs mixed with well-considered residential offerings – all the while maintaining its character and charm,” the architect noted in planning documents submitted to Brisbane City Council.

The architecture practice said the project’s form was shaped by its riverfront setting, flood considerations, neighbouring building scales, and view corridors.

“They said the mix of four and two-bedroom apartments capture the ‘fundamental qualities of Queenslander living,’ translated into the context of a contemporary subtropical building.”

The development sits just off Coronation Drive within walking distance of Toowong’s retail precinct and the upgraded Regatta ferry terminal, while also benefiting from proximity to the incoming green bridge connection to West End. Sammut said the accessibility and amenity offering were central to the site’s appeal.

The approval adds to growing residential activity along the Toowong riverfront, joining nearby projects including Consolidated Properties’ Monarch Residences and Spyre Group’s ARC Residences.

Sammut secures approval for debut Brisbane apartment development in Toowong

Developer Lanevick is heading back into Sydney’s apartment market after focusing more heavily on the luxury townhouse and terrace sector in recent years.

Lanevick, founded and directed by Steve Maroun, is expecting to receive approval in the coming months for a new apartment development in Gladesville, with the aim to launch it to the market later this year.

The 51-apartment project, designed by Studio Johnston, will comprise a mix of one-, two-, and three-bedroom apartments positioned toward the Hunters Hill downsizer market.

“Traditionally it’s been difficult for people in that market to downsize because there just hasn’t been the right product available,” Maroun said.

“We’re targeting buyers who might have 30 to 40 per cent of their house value sitting in the bank after downsizing.

“They still want good spacious entertaining areas, they still want quality design, but they also want flexibility and the ability to enjoy life a bit more after working hard for a long time.”

The project sits near Boronia Park and within close proximity to the Parramatta River foreshore, an area Maroun says offers more of a Hunters Hill lifestyle than a traditional apartment precinct.

“From a lifestyle perspective, it’s really more Hunters Hill than Gladesville,” Maroun said. “You’re close to the foreshore, close to parklands, and still connected back into the village precinct.”

From level four and above, apartments will capture water views&nbsp;toward Sydney Harbour. Communal amenity will include rooftop entertaining areas, wellness spaces, and a gym tailored toward owner-occupier buyers.

“We’ve really designed these apartments around that buyer coming from the Hunters Hill LGA and what they’re actually looking for in their next chapter.”

The proposed development has also been designed to respond to the changing character of the broader Gladesville town centre, where a growing number of mixed-use and residential proposals are expected to emerge over the coming years.

“Gladesville presented a rare opportunity to deliver a genuinely design-led residential project within an evolving lifestyle precinct, just moments from the growing Gladesville town centre, and we’ve approached the project with a strong focus on architecture, liveability and long-term community value,” Maroun said.

Maroun said Lanevick saw a first-mover advantage within the precinct as planning controls continue to evolve to accommodate greater housing density.

“We think there’s a real opportunity there that hasn’t really been serviced properly yet,” he said.

“There’s going to be a broader evolution of the whole Gladesville village precinct over time, particularly with more activation and mixed-use outcomes.”

The Venus Street proposal will include a commercial and retail component at ground level designed to contribute to that evolving streetscape activation.

“A big part of the thinking was how do you activate that area properly and create more vibrancy and amenity, which is what Hunters Hill has been looking for,” Maroun said.

Lanevick’s focus since 2020 has largely been on smaller-scale luxury townhouse and terrace developments. The developer recently completed Royale Randwick, also designed by Studio Johnston, where prices reached $3.65 million. The project was featured in the UDIA NSW 2026 Professional Development Prospectus and was also named a finalist for Development of the Year.

&nbsp;

Lanevick to cater for Hunters Hill downsizers with new Gladesville apartment development

Property developer One Living, backed by former Macquarie banker turned investment manager Chris Green’s investment firm, has unveiled plans to bring more institutional capital into housing to help address the national supply crisis.

The New York-based investor has focused his firm, GreenPoint Partners, on addressing the supply shortage hitting middle market housing in Australia.

It is backing the new One Living business to develop more than 1000 units along the eastern seaboard. The new firm is starting with a development on Mona Vale Road, on the border of Mona Vale and Pymble, in Sydney’s Northern Beaches, with around 140 apartments planned. They are eyeing off more sites across the city.

With cost pressures rising in the industry, One Living’s model is to be a vertically integrated developer-builder, so it can respond directly to the housing gap by removing the cost inefficiencies embedded in traditional residential delivery.

“We are building a platform designed to operate at scale and starting in a market where there’s a clear need for quality, attainable housing,” One Living joint managing director Joseph Scuderi said.

“It’s that missing middle – it’s that attainable end of housing… that’s what most Australians invest into and what Australians can actually afford.”

<img alt="Mona Vale" data-entity-type="file" data-entity-uuid="798dfa93-4941-4db6-a696-31e9dc18e81c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.31.50%E2%80%AFPM.png?VersionId=mKBqi5C_DmeiXS.AtJkcR8LQIxqCqmFi" />

GreenPoint Partners brings years of experience assembling and scaling real estate operating businesses across major markets. And Green sees a big opportunity in Australia.

“For its size, sophistication and importance to the community, Australia’s living sector has remained largely under-institutionalised, which represents significant opportunity,” Green said. “GreenPoint identified that gap, assembled the right team, and is backing One Living to build a platform that is aligned to market needs.”

Green said being a builder-developer would give the company the capacity and flexibility it required to deliver reasonably-priced homes.

“We want it to be at that attainable level; not super high end luxury but at that attainable level,” he said.

<img alt="Mona Vale" data-entity-type="file" data-entity-uuid="74a5344a-4b26-4d4a-ada3-056b1220be77" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.32.15%E2%80%AFPM.png?VersionId=vY8hXHO4reBMdO8ZXMWCNtGZJofUPQ3j" />

&nbsp;

One Living will undertake a component of affordable housing in its schemes, which it will own and operate, and it could also run build-to-rent on some sites.

Green praised local policy settings.

“The NSW government is being very supportive, strategic and pragmatic in terms of how do we generate more supply of housing,” he said. “We think it’s actually positive for development and the bit that’s been lacking at that attainable level is that it’s lots of relatively small private developers, whereas we want to create an institutional platform.”

One Living is also&nbsp;looking at high-density projects and could take on more institutional funding in the future.

“The way we will be able to achieve economies of scale is through size,” Green added.

One Living enters Sydney's new apartment market with Northern Beaches site acquisition

It's been several years since there's been an opportunity to buy a brand new townhome in Melbourne's coastal suburb of Mordialloc. Even apartment developments in recent times have been few and far between in the area.

Local developer LDS Property identified the gap in new housing, securing a site on White Street, directly opposite&nbsp;Woodlands Golf Club Mordialloc. They've recently launched&nbsp;<a href="https://www.apartments.com.au/new-townhouses/wm-residences-mordialloc-102-white-street-mordialloc-vic-3195">WM Residences</a>, just 13 townhouses which they have already started building.

Projects by Buxton Director Heath Thompson, who is selling WM Residences, says the townhouses x that perfect middle ground be

"Mordialloc residents have had limited options to downsize within the suburb, often forcing them to look elsewhere despite long-standing ties to the area," Thompson says.

"With very little comparable new supply coming to market, projects like WM Residences are well placed, particularly as buyers look to capitalise on current conditions amid constrained supply."

[smartcode_project:default project_id=134646 project_image_fid=6109]

The development, designed by regarded architecture firm&nbsp;<a href="https://www.apartments.com.au/architects/ewert-leaf">Ewert Leaf</a>,&nbsp;adopts a deliberately restrained architectural approach, focusing on simplicity, durability and liveability rather than overt design gestures.

The boutique scale is central to the offering. With only 13 three-bedroom residences, each home is configured to prioritise functional layouts and everyday use, supported by private terraces and secure two-car garages.

Ewert Leaf’s design response leans into a calm, neutral material palette. Interiors are defined by oak flooring, white walls and soft finishes, creating a consistent and understated backdrop. The approach avoids trend-driven detailing in favour of longevity, with an emphasis on natural light and spatial clarity.

[smartcode_project:default project_id=134646 project_image_fid=6110]

Beyond aesthetics, the homes are designed to meet contemporary performance expectations. Each residence targets a minimum 6-star energy rating, incorporating double glazing, comprehensive insulation and all-electric Bosch appliances.

The project’s location supports a walkable coastal lifestyle, sitting within close proximity to Mordialloc’s foreshore, Main Street retail strip and the train station. Local cafés and dining venues, including Suburbia Deli and Hendriks Café, are within a short walk, reinforcing the area’s established neighbourhood character.

[smartcode_project:default project_id=134646 project_image_fid=6116]

While <a href="https://www.apartments.com.au/developments/mordialloc-vic-3195">Mordialloc</a> is often defined by its beach and pier, the project taps into other areas of day to day living, offering easy access to local food, casual dining and transport, rather than positioning itself purely as a lifestyle retreat.

WM Residences reflects a continued trend across Melbourne’s coastal suburbs towards smaller-scale, design-led townhouse developments, particularly on infill sites where proximity to amenity is already established.

With construction commenced prior to its market entry, the project aligns with a growing preference among buyers for developments with visible progress and defined delivery timeframes.

[smartcode_project_cta:default project_id=134646]

WM Residences fills gap in Mordialloc townhouse market

Housing Affordability

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Affordability nationwide improved in the five years between 2011 and 2016 – that’s one of the more interesting facts to emerge from the 2016 Census data. 
An analysis by population analysts profile.id finds that the median mortgage payment in 2011 was $1,800 per month, but in 2016 it was $1,755. Over the same period the median household income increased from $5,330 to $6,205 per month. 
Of course, these are national average figures and they conceal myriad differences among the various states and cities. The biggest improvements in affordability, in terms of the reduction in mortgage payments, occurred in Queensland and the ACT. 
But there was even a small improvement in New South Wales, notwithstanding the big price rises in Sydney. 
Unsurprisingly, the biggest single factor in the reduction in mortgage payments was the decrease in interest rates. In 2011, the official cash rate was 4.5 percent and by 2016 it was 1.5 percent. Glenn “the Census expert” at profile.id says: “While the banks have passed on less and less of these cuts, it’s certainly the case that mortgage interest rates being paid by home owners in the past five years have reduced.” 
Perhaps the most startling fact is that the median mortgage payment for the Greater Sydney area was the same in 2016 as it was in 2011. And in Melbourne the median mortgage payment reduced slightly. 
The analysis examined mortgage payments for people aged between 18 and 34 who have a mortgage and don’t live at home with their parents – i.e. looking at the profile most likely to include first-time buyers. This is where the improvement in affordability was actually the highest, in terms of the reduction in median mortgage payments between 2011 and 2016. 
In the ACT, for example, median monthly payments dropped from $2,460 to $2,140, while in Queensland they fell from $2,165 to $1,958. Even in NSW, the median mortgage payment for this demographic dropped from $2,182 to $2,129. 
As Glenn points out: “There are very large falls in mortgages in the ACT ($320/month) and Queensland ($207/month). But even in Sydney and Melbourne, which have seen rapid escalation of housing prices, there have been modest declines in what 18-34 year olds are actually paying on their mortgages when they have them. 
“So in fact, a larger part of the decline (in mortgage payments) is in this key group. Probably because they have the larger mortgages and are more affected by changes in interest rates. So, while we have seen that children are delaying leaving home longer (though not much longer), once they do leave home they are actually paying less to buy a house.” 
These figures put another perspective on the general issue of housing affordability. 
But here’s the thing: every day the Hotspotting team scours media sources for information on residential real estate and, to date, we haven’t found any coverage of this very thorough and professional analysis of the affordability situation. 
No newspaper or other media outlet has run this story. Why not? Because it doesn’t suit the pre-conceived storyline, the much-beloved theme of everyone being priced out of the market. 
Another reflection of media bias on this subject came earlier in the year when one of the major affordability indexes published the latest findings. There were two scenarios: in annual terms, affordability had improved in most states and territories, but comparing the latest quarter to the previous quarter, affordability had declined in most states and territories. 
Every media outlet which ran an article in this report focused on the quarter-to-quarter deterioration and totally ignored the annual improvement. 
Media has created a “crisis” by selectively using data to support the favoured theme which says no one can afford to buy any more. It’s obviously rubbish but that’s what they keep telling us – and so when someone runs a survey on the issue, a majority of citizens say they believe young people are priced out of the market everywhere. 
It’s sad how dishonest our media is and also sad how easily people are deluded by it. 
Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="mailto:%20%3Cscript%20type='text/javascript'%3E%20%3C!--%20var%20prefix%20=%20'ma'%20+%20'il'%20+%20'to';%20var%20path%20=%20'hr'%20+%20'ef'%20+%20'=';%20var%20addy38821%20=%20'ryder'%20+%20'@';%20addy38821%20=%20addy38821%20+%20'hotspotting'%20+%20'.'%20+%20'com'%20+%20'.'%20+%20'au';%20document.write('%3Ca%20'%20+%20path%20+%20'/''%20+%20prefix%20+%20':'%20+%20addy38821%20+%20'/'%3E');%20document.write(addy38821);%20document.write('%3C//a%3E');%20//--%3E/n%20%3C/script%3E%3Cscript%20type='text/javascript'" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a>
 
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terryryder-YECXbqmri2

Affordability actually improving in terms of mortgage payments: Terry Ryder

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Key workers – such as teachers, nurses, ambulance and fire officers and the police – perform essential services.
Across the Sydney some 156,000 workers are employed in these occupations, equating to some six per cent of the workforce.
However, high property prices and high rents are placing barriers to their home ownership which were not experienced by previous generations. 
There is now a serious mismatch between where key workers live and work, according to an important report prepared by Sydney University researchers for the Teachers Mutual Bank, Firefighters Mutual Bank, Police Bank and My Credit Union.
The report found that in the decade to 2016, key areas in Sydney lost up to 20 percent of teachers, nurses, policy and emergency service workers to outer and regional areas, while areas including the Illawarra, Southern Highlands and the Hunter Valley had net gains.
In 2006 more than 20 local government areas were affordable to a police senior constable. By 2016, that number had declined to four. 
The majority of key workers now reside in outer ring suburbs, which the report advised was unlike other world cities, such as London, New York, or San Francisco.
The problem begins with the shortage of affordable rental homes near employment as this undermines the capacity to save for a deposit.
An enrolled nurse with five years experience on $57,000, requiring a one bedroom rental property, would be able to afford a median property in only 9 per cent of middle ring suburbs and in no inner ring suburbs. 
As a consequence, many key workers are commuting long distances to get to work, or are living in unaffordable rental accommodation. 
There's no doubting Sydney needs its Macquarie Street policy makers to improve key worker access to home ownership given the lack of affordable and appropriate homes.
But the report also identified one way to help restore housing options that requires innovative consideration of the plight of challenged home buyers bu the banking and superannuation sectors.
A key suggestion was the implementation of shared equity models that have long been used in the United Kingdom to help low and moderate income earners enter home ownership. 
According to the UK Council of Mortgage Lenders, there are around 200,000 shared ownership homes in the UK where eligible households can purchase a minimum of 25 per cent of a property (and up to 75 per cent) and pay a rent of 3 per cent on the remaining share.
Over time the household can purchase the remaining equity in the property from the affordable housing provider partner (who owns the balance), or repay it when the house is sold. 
We need mortgage lenders to embrace shared ownership.
It needs superannuation funds to joint venture with banks in this product. 
This article was first published in the Saturday Daily Telegraph.
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jchancellor-FAypfDUnLy

Banks need to embrace shared ownership concept as way forward for home affordability

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A housing affordability report has found WA is the most affordable state in the country for tenants and home-buyers. Only the two Territories - the ACT and Northern Territory - are more affordable.
It’s one piece of a multi-faceted equation which equals recovery in the Perth property market.
While media continues to obsess over Sydney and has extrapolated the wind-down in its market into a national downturn, other scenarios are playing out in different parts of this complex nation.
Perth has been running counter-cyclical to Sydney for the past five or six years and this continues. In 2012, when Perth prices were rising strongly, Sydney was doing very little; as Sydney got on its growth path from 2013 onwards, Perth was heading into reverse; and now, as Sydney runs out of steam, Perth is recovering and moving forward.
Improved affordability after four years of price decline is one of the factors giving Perth momentum.
The Real Estate Institute of Australia and Adelaide Bank, in their latest Housing Affordability Report, have found that affordability in WA’s housing and rental markets has improved markedly.
According to the report, the proportion of income required for tenants to pay their rent had decreased from 19.2% in late 2016 to 17.4% in late 2017.
For those looking to buy their first home, the proportion of income required to meet home loan repayments decreased from 23.8% in 2016 to 22.4% in 2017.
The result reflects the decline in property values and rentals in Perth and other parts of WA in recent years, exacerbated by the end of the resources investment boom, which pushed up residential vacancies.
But the Perth property market generally ended 2017 on a positive note, with December Quarter data from the REIWA showing improvements in median prices, sales activity, listing levels and average selling days.
Supporting that is Domain figures for the December Quarter, which show small quarterly rises in the median prices for both houses and apartments, although the annual figures are still a little negative.
In addition, the latest SQM Research figures show small monthly rises although, again, the annual data is still in the negative.
All this is making Perth “the land of opportunity” and it’s the main reason I’m heading to Perth to do a seminar presentation on 15 March.
REIWA president Hayden Groves says it bodes well for Perth that all key indicators improved over the latest quarter.
“The Perth market found its floor and stabilised in the back half of 2017,” he says. “We now appear to be entering a recovery phase, though REIWA remains cautious about expectations of rapid growth in the next 12 months.”
Perth’s preliminary median house price increased 1.2% to $516,000 in the December Quarter - but once all sales have settled, REIWA expects the final December Quarter median to lift to $520,000, which would be a notable rise on the September Quarter median of $510,000.
Perth’s median unit price is $405,000 for the December Quarter which is a 1.3% increase on the September Quarter.
There were 4,946 dwelling sales in Perth in the December quarter. Groves says this figure is expected to lift to 6,700 once all sales have settled, putting it significantly above the September Quarter sales figure.
“Traditionally, the September Quarter outperforms the December Quarter, but that wasn’t the case in 2017. The December Quarter is on track to record 14% more sales than September,” Groves says.
The primary reason for the revival in the Perth property market is the recent improvement in the state economy.
Further confirmation of WA’s revival comes from Reserve Bank governor Philip Lowe, who says the state economy has “turned the corner”.
Lowe says while the national economy is gaining strength, WA is not being left behind, with signs of a lift in mining investment through the State.
“We’re starting to see more self-sustaining investment growth in WA in the mining sector and that’s picking up conditions in Perth,” Lowe says. “It’s not a boom again but there’s more sustainable investment going on and that’s helping the WA economy.”
Outside the mining sector, Lowe cites the lift in public infrastructure projects as one of the reasons the economy is improving.
 
Terry Ryder is the founder of hotspotting.com.au
<a href="https://mailto:ryder@hotspotting.com.au">ryder@hotspotting.com.au</a>
twitter.com/hotspotting
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Perth's counter cyclical property market is now moving forward: Terry Ryder

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It is critical that government and industry continued to work together to ensure build-to-rent schemes could become more feasible to help address the current housing affordability issues facing so many Australians.
Build-to-rent is popular overseas in countries like the Unites States, but is still in its early stages in Australia.
As a major investor in affordable housing First State Super wants to expand our investments in this sector and see the barriers removed to make way for the market to grow.
Growth in this sector is not as financially viable in Australia as it is internationally due to a number of challenges presented by the Australian financial system with its current tax laws.
The build-to-rent sector in the United States was significant, largely made possible by the financial system in the US – particularly the banking and debt systems and urged for greater tax incentives in Australia, including GST reform and a reduction in stamp duty.
Additional changes to policy to make build-to-rent more attractive in Australia were needed including reductions to land tax as well as additional concessions for density requirements under planning laws.
In order for build-to-rent projects to be successful there needs to be a reduction in land tax and more release of State and Federal land available for development. The Australian landscape has proven to be difficult with a higher cost of land holding it back compared to some overseas markets.
First State Super welcomed the NSW Government’s recent announcement that it would cut land tax for the next 20 years for new build-to-rent housing projects and would give a 50 per cent discount on land tax to developers who invested in build-to-rent schemes. Additional schemes for build-to-rent housing projects would be welcomed to allow for more investment in this space.
Now is the opportunity for governments, industry and investors to work together and respond to these challenging issues and allow for more investment opportunities of scale in affordable housing and build-to-rent developments.
First State Super has commenced its first ‘build to rent’ affordable housing project in New South Wales and is interested in expanding its investments across Australia, in addition to other affordable housing initiatives.
Over the past 12 months First State Super has invested $250 million in key worker affordable housing initiatives in NSW and Victoria; one of the largest commitments of this kind of any Australian super fund.
These key worker affordable housing investments have seen hundreds of new or renovated apartments and units rented to nurses, teachers, police, paramedics, aged and disability support workers and other key workers at 80 per cent of the market rate.
We know that for many key workers finding safe, secure quality housing near their workplace is a challenge. These investments support key workers to secure affordable rental accommodation close to work and other important amenities.
However, they also support our crucial construction sector to maintain jobs and move forward with important projects despite the economic uncertainty.
First State Super will be making further announcements regarding additional investments in affordable housing shortly and has committed to increase that investment to $400 million this year.
There is a real opportunity for investors like us to collaborate with government to respond to the significant issue of housing affordability, to help support future housing needs across the country, provide a welcome boost to construction and to support jobs.
DAMIEN GRAHAM is the First State Super Chief Investment Officer 
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Build-to-rent is a key element of housing affordability going forward: Damian Graham

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EXPERT OBSERVER
The HIA-Housing Affordability Index for the June quarter 2020 shows housing in Australia remains at its most affordable since 1999.
HIA’s Affordability Index is calculated for each of the eight capital cities and regional areas on a quarterly basis and takes into account the latest dwelling prices, mortgage interest rates and wage developments.
Housing affordability improved in the June quarter across all capital cities.
This improvement in affordability means that it now requires less than 1.2 average incomes to service a mortgage on a median-priced dwelling in Australia’s capitals.
This is a rapid improvement from just three years ago when it required more than 1.4 times the average income to service the same mortgage.
The combination of lower interest rates, slow house price growth and relatively steady wage growth over the past three years have driven this improvement in affordability.
Unfortunately this is cold comfort for many first home buyers.
Repaying a mortgage is no longer the constraint it was over the past two decades. The increase in the number of new homes built over the past five years has kept a lid on house price growth.
The challenge facing first home buyers is no longer their ability to repay a loan, but in obtaining a mortgage in the first place.
A decade of red tape has made it significantly harder for first home buyers to obtain a mortgage for purchasing their first home.
A raft of restrictions imposed by APRA and ASIC since the 2007 Global Financial Crisis has seen the number of home loans issued with a 10 per cent deposit fall from 21 per cent of all loans to just 7 per cent.
As the Governor of the Reserve Bank, Phillip Lowe said, the pendulum has swung too far.
The additional red tape imposed in recent years means that banks are increasingly lending to those that already own a home.
Improving access to finance helped pull the economy out of the 1990’s recession and it can do the same for the COVID-19 recession.
The HIA Housing Affordability Index for the capital cities increased by 5.6%, led by Perth (+7.1%), Melbourne (+6.9%) and Sydney (+6.1%). Brisbane also increased by 5.0%, followed by Canberra (3.3%), Hobart (+3.1%), Adelaide (+3.1%) and Darwin (+1.6%). The Index for regional Australia also increased by 4.9 per cent.
TIM REARDON is the HIA’s Chief Economist
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Housing in Australia at its most affordable since 1999

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EXPERT OBSERVER
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For years Australia has suffered from poor housing affordability. 
According to the 2020 Demographia Housing Affordability Survey the multiple of median house prices to median annual incomes is 5.9 times in Australia compared to 3.9 times in Canada, 4.5 times in the UK &amp; 3.6 times in the US. 
Consistent with this the ratio of house prices to incomes relative to its long-term average is at the high end of OECD countries.
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It wasn’t always so - Australia was once seen as a country with relatively cheap and affordable housing. 
Having a house on a quarter acre block was an essential part of the “Aussie dream”. But that changed last decade as average house prices went higher and higher relative to average incomes and this went hand in hand with a surge in household debt relative to income. See the next chart. 
There have been several cyclical downswings in property prices that have brought short term relief in terms of affordability – around the GFC when average capital city dwelling prices fell 7.6% based on CoreLogic data, around 2011 when prices fell 6.2% and in 2017-19 when prices dipped 10.2% - but they have been short lived with prices quickly bouncing back.
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The coronavirus shock may have a more lasting impact. It has brought lots of pain and suffering on a human level but also on an economic level. And it has caused much disruption to the property market in the short term with more likely to come. But it may have a lasting positive legacy in relation to property - that is more affordable housing in Australia. 
Why is Australian housing so expensive? 
To understand why this may be the case its necessary to consider what has caused poor housing affordability in Australia in the first place. It’s been popular to blame tax concessions, foreign buying, government related housing infrastructure charges and stamp duty and low interest rates and easy credit. But none of these really explain it.
Lots of other countries have a variety of housing tax concessions too, but with much cheaper housing. Foreign buying is a relatively small part of the overall market and has declined in recent years. Infrastructure associated with housing is hardly unique to Australia. Stamp duty adds to the cost of transactions and is a silly tax, but if anything may have kept prices lower than they otherwise would be (when supply is constrained). The shift from high interest rates to low interest rates enabling bigger loans has enabled ever more expensive housing – but other countries have also seen ultra-low interest rates in recent decades and yet have much cheaper housing. 
Rather the basic problem has been a surge in population growth from mid-last decade and an inadequate supply response (thanks partly to tight development controls and lagging infrastructure). Since 2006, annual population growth averaged about 150,000 people above what it was over the decade to the mid-2000s. This required the supply of an extra 50,000 new homes per year. See the next chart. Unfortunately, this was slow in coming. But with an insufficient supply response to surging demand, prices were able to stay elevated. And so poor housing affordability got locked in.
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Each cyclical downturn in house prices has brought hope of a solution, but it was invariably dashed as the fundamental supply demand imbalance remained or re-established itself. The same looked to be applying more recently with average house prices surging 10% between June last year. 
The longer-term impact of coronavirus 
The coronavirus shock has the potential to change this dynamic of cyclical fluctuations around ongoing poor affordability. It has already triggered a renewed downturn in property prices with capital city prices down 2% on average since April, with Melbourne prices down around 4%. JobKeeper and the bank payment holiday are preventing faster falls at present. But further declines in national prices are likely, as high unemployment, the depressed rental market and the collapse in immigration impact. We now see average capital city prices falling 10-15% from their April high out to mid-next year with Melbourne most at risk and likely to see a 15-20% decline. 
Past experience would suggest that this may be just another cyclical downturn and once coronavirus comes under control and the economy rebounds it will be back to normal with poor affordability. Particularly with record low interest rates making it feasible to borrow up big. However, the coronavirus shock has the potential to change this for three reasons.
- First, the hit to economy from coronavirus is bigger than anything seen in the post war period. While most of the activity hit by lockdowns should bounce back once the virus is brought under control some things will take longer to recover (eg, travel &amp; tourism), some will be permanently changed for ever (with eg, a big shift to on-line shopping, education, health care &amp; watching sports) and businesses will use the uncertainty to accelerate cost savings. All of which will mean a long tail of unemployment. JobKeeper has shielded Australia from what otherwise would have been 15% unemployment in April and 11% unemployment now. But officially measured unemployment is still likely to hit 10% by year end and will probably have only fallen to around 9% by end 2021. This will likely result in more forced property sales and act as a drag on home prices, as income support measures &amp; the bank payment holiday wind down.
- Second, immigration has been a big driver of property prices and it’s taken a huge hit and may take a long while to recover. Thanks to travel bans, net immigration is likely to have fallen to just below 170,000 in 2019-20 and to around 35,000 this financial year from 240,000 last financial year. This is a huge hit which will take population growth in 2020- 21 to just 0.7%, its lowest since 1917. See next chart. This will reduce annual underlying demand for homes to around 120,000 dwellings, compared to underlying demand last year of around 200,000. This could result in a significant oversupply of dwellings, and in turn could reverse the years of undersupply that has maintained very high house prices since mid-last decade. (See the population versus dwelling completions chart above.) A big cut to immigration is not something many other countries have to deal with, so their experience is not directly translatable to Australia. Of course, if this is just for a year, it wouldn’t have much lasting impact. And the return of expat Australians may provide a short-term offset. But with unemployment likely to remain high for some time, it will be hard politically for the Government to quickly ramp up immigration to previous levels, even once it is safe to do so from a coronavirus perspective. After the early 1990s recession net immigration stayed low at around 90,000 pa until the mid-2000s. All of which points to a long period of constrained housing demand and hence more constrained house prices.
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- Finally, a mass shift to working from home potentially has huge implications for residential property prices. Prior to coronavirus, working from home was only slowly creeping in. Now coronavirus driven lockdowns and social distancing has shown that its feasible for most white-collar workers and can be good for productivity. Of course, full time working from home does come with costs in terms of team cohesion, corporate culture, the development of younger workers and less opportunities for spontaneously exchanging ideas. So, some sort of hybrid may become the norm – some at home all the time, some in the office all the time, but most doing half and half. And working from home works best in houses where there’s lots of room as opposed to apartments. All of which could revolutionise residential property demand - and from what I am hearing anecdotally maybe already is. Which will mean less demand for property close to the CBD, greater demand for property in suburbs, with a decent community and environment and increased property demand in regional centres. All of which could break down the dominance of the city with its expensive property. This would turn the trend of recent decades favouring more condensed living close to the city on its head. Some office property (and possibly also some retail property impacted by the shift to online retailing) could be repurposed for residential use, thereby boosting housing supply. By fostering decentralisation, a shift away from cities to regional communities could dramatically improve housing affordability over time. 
Concluding comment 
We are still fighting the war against coronavirus but it’s likely, as we have seen with various shocks in the past, we will get over it, and go back to something more normal. But not everything will go back to normal. A lasting impact could be more affordable housing in Australia. It’s not our base case that this will come in the form of a property crash (and that would be a bad outcome for the economy anyway via negative wealth effects) but it could come in the form of much softer property price gains over time (after the initial hit into next year). 
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SHANE OLIVER | Head of Investment Strategy and Chief Economist | AMP CAPITAL
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Why COVID might fix Australia’s housing affordability crisis: Shane Oliver

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Western Australia is the most affordable state to live in for the eleventh quarter in a row, according to the latest Real Estate Institute of Australia report. 
REIWA president Damian Collins said the report findings revealed affordability in WA's housing and rental market were still at their best levels. 
“The March quarter was an unusual one for the entire nation due to COVID-19, however it’s pleasing to see that WA has remained the most affordable state, while seeing prices and rents holding and not falling significantly, as was predicted by many early on,” Mr Collins said. 
According to the report, tenants in WA were only required to use 16.6 per cent of their family income to pay their rent in the March quarter.  
"This is significantly below other states where it reached as high as 30.5 per cent.” Mr Collins said. 
The proportion of family income required to meet home loan repayments was 25 per cent in WA over the same period, significantly less than NSW where homeowners still pay an average of 42.5 per cent of their family income on home loan repayments. 
However, affordability improved across the nation overall as red-hot markets in Sydney and Melbourne cool. 
“While the dream of home ownership remains a challenge on the East Coast, it’s very much alive and well in WA, as our rents and home values are the most affordable of all the states,” Mr Collins said. 
 
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Western Australia retains top spot as most affordable state; REIWA

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The REIA Housing Affordability Report is out for the March quarter and shows a marginal improvement across the country to housing affordability.
The proportion of income required to meet loan repayments decreased by 0.1 percentage points to 34.7 per cent over the quarter, according to the report.
In his introduction to the report REIA president, Adrian Kelly outlined the highlights of the findings.
“With the exception of Victoria, Tasmania and Western Australia, housing affordability improved across the states and territories with the Australian Capital Territory having the largest improvement 1.1 percentage points,” said Mr Kelly.
“Rental affordability improved in the March quarter with the proportion of income required to meet rent payments decreasing to 23.5 per cent, a decrease of 0.1 percentage points over the quarter.
“Rental affordability improved in Queensland, Western Australia and the Northern Territory, but declined in New South Wales, Victoria, South Australia, Tasmania and the Australian Capital Territory.”
When it comes to loans the total number has declined compared to the December quarter of the previous year.
“This is not unusual for the first quarter of the calendar year, however there was a 4.2 per cent increase on the number of new loans from the same quarter of 2019,” said Mr Kelly.
“The number of first home buyers decreased to 27,082, a decrease of 10.7 per cent during the quarter but an increase of 23.1 per cent compared to the March quarter 2019.
“With the introduction of the First Home Buyer Deposit scheme on 1 January we expect that share of first home buyers will continue to grow.”
The report shows the number of first home buyers decreased in all states and territories over the March quarter.
The largest decrease was in the Australian Capital Territory (-22.2 per cent).
Compared to the corresponding quarter 2019, the number of first home buyers increased in all states and territories, with the largest increase in the Australian Capital Territory (57.6 per cent).
The next edition of the report will reflect the impact the current COVID19 pandemic has had on affordability.
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<h2>State by State</h2>
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NSW
Over the March quarter, housing affordability in New South Wales improved with the proportion of income required to meet loan repayments decreasing to 42.5 per cent, a decrease of 0.4 percentage points over the quarter but an increase of 4.5 percentage points compared with the corresponding quarter 2019.
With the proportion of income required to meet loan repayments 7.8 percentage points higher than the nation’s average, New South Wales remained the least affordable state or territory in which to buy a home.
Over the March quarter, rental affordability in New South Wales declined marginally with the proportion of income required to meet median rents increasing to 27.5 per cent, an increase of 0.1 percentage points over the quarter but a decrease of 0.7 percentage points compared with the corresponding quarter 2019.
In New South Wales, the number of loans to first home buyers decreased to 6,622 a decrease of 11.0 per cent over the quarter but an increase of 33.3 per cent compared to the March quarter 2019.
Of the total number of first home buyers that purchased during the March quarter, 24.5 per cent were from New South Wales while first home buyers make up 32.9 per cent of the state’s owner-occupier market.
The average loan to first home buyers increased to $502,552, an increase of 2.4 per cent over the quarter and an increase of 19.8 per cent compared to the same quarter last year.
The number of dwelling loans in New South Wales decreased to 20,105, a decrease of 17.5 per cent over the quarter but an increase of 8.5 per cent compared to the March quarter 2019.
The average loan size increased to $595,315, an increase of 0.4 per cent over the quarter and an increase of 22.2 per cent compared to the corresponding quarter of 2019. New South Wales has the largest average loan size across the country, 22.4 per cent higher than the national average.
Victoria
Over the March quarter, housing affordability declined in Victoria with proportion of family income devoted to meeting average loan repayments increasing to 37.5 per cent, an increase of 1.0 per cent over the quarter and an increase of 2.9 per cent when compared to the corresponding quarter in the previous year.
Rental affordability in Victoria declined over the quarter with the proportion of income required to meet median rent increasing to 23.0 per cent, an increase of 0.4 percentage points over the quarter but a decrease of 0.1 percentage points over the previous year.
The number of loans to first home buyers in Victoria decreased to 8,624, a decrease of 16.0 per cent over the quarter but an increase of 24.4 per cent compared to the March quarter 2019.
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Of the total number of first home buyers that purchased during the March quarter, 31.8 per cent were from Victoria while first home buyers make up 40.3 per cent of the state’s owner-occupier market.
In the March quarter 2020, the average loan to first home buyers was $437,871, an increase of 2.3 per cent over the quarter and an increase of 14.0 per cent compared to the March quarter 2019. In Victoria, the total number of loans decreased to 21,396, a decrease of 15.8 per cent during the quarter but an increase of 4.3 per cent compared to the March quarter 2019.
The average loan size was $514,741 over the quarter, an increase of 4.1 per cent and an increase of 18.8 per cent when compared to the corresponding quarter 2019. Victoria’s average loan size is 5.9 per cent higher than the national average.
Queensland
Housing affordability improved in Queensland over the March quarter with the proportion of income required to meet home loan repayments decreasing to 30.4 per cent, a decrease of 0.2 percentage points over the quarter but an increase of 0.8 percentage points when compared to the March quarter 2019.
Rental affordability in Queensland improved over the quarter with the proportion of the median family income required to meet the median rent decreasing to 22.0 per cent, a decrease of 0.1 percentage points over the quarter but remained stable compared with the same quarter 2019.
Over the March quarter, the number of loans to first home buyers in Queensland decreased to 5,419, a decrease of 5.9 per cent over the quarter but an increase of 20.8 per cent compared to the same quarter of 2019.
Of all Australian first home buyers over the quarter, 20.0 per cent were from Queensland while the proportion of first home buyers in the state’s owner-occupier market was 34.1 per cent.
The average loan size to first home buyers increased to $374,036, an increase of 3.4 per cent during the quarter and an increase of 12.9 per cent compared to the March quarter 2019.
The number of loans decreased in Queensland to 15,911, a decrease of 11.1 per cent over the quarter but an increase of 5.4 per cent compared to the March quarter of the previous year.
The average loan size increased to $414,154, an increase of 0.4 per cent during the quarter and an increase of 12.0 per cent compared to the March quarter 2019. Queensland’s average loan size is 14.8 per cent lower than the national average.
South Australia
Over the March quarter, housing affordability in South Australia improved with the proportion of income required to meet monthly loan repayments decreasing to 27.9 per cent, a decrease of 0.1 percentage points over the quarter but an increase of 0.2 percentage points compared to the March quarter 2019.
Rental affordability in South Australia declined over the quarter with the proportion of income required to meet rent payments increasing to 22.5 per cent, an increase of 0.2 percentage points over the quarter but a decrease of 0.3 percentage points compared to the March quarter 2019.
Over the March quarter, the number of loans to first home buyers in South Australia decreased to 1,493, a decrease of 10.5 per cent over the quarter but an increase of 8.7 per cent compared to the March quarter 2019.
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Of all Australian first home buyers over the quarter, 5.5 per cent were from South Australia while the proportion of first home buyers in the state’s owner-occupier market was 25.9 per cent.
The average loan size to first home buyers increased to $334,226, an increase of 1.4 per cent over the quarter and an increase of 8.2 per cent when compared to a year earlier.
In South Australia, the total number of loans decreased to 5,764, a decrease of 11.5 per cent over the quarter and a decrease of 4.5 per cent compared to the March quarter 2019.
The average loan size increased to $358,171, an increase of 0.8 per cent over the quarter and an increase of 10.3 per cent compared to the same time last year.
South Australia’s average loan size is 26.3 per cent lower than the national average.
Western Australia
Over the March quarter, housing affordability in Western Australia declined with the proportion of income required to meet loan repayments increasing to 25.0 per cent, an increase of 0.1 percentage points over the quarter and an increase of 0.2 percentage points compared to the March quarter 2019.
Rental affordability in Western Australia improved during the March quarter with the proportion of family income required to meet the median rent decreasing to 16.6 per cent, a marginal decrease of 0.1 percentage points over the quarter and a marginal increase of 0.1 percentage points compared to the year before.
The number of first home buyers in Western Australia decreased to 3,547 in the March quarter, a decrease of 2.3 per cent over the quarter but an increase of 12.0 per cent compared to the same time last year.
Of all Australian first home buyers over the quarter, 13.1 per cent were from Western Australia while the proportion of first home buyers in the state’s owner-occupier market was 45.9 per cent.
The average loan to first home buyers increased to $353,115, an increase of 2.2 per cent over the quarter and an increase of 9.1 per cent when compared to the March quarter 2019.
The total number of loans in Western Australia decreased to 7,733, a decrease of 6.7 per cent over the quarter but an increase of 4.3 per cent compared to the March quarter 2019.
The average loan size increased to $406,246, an increase of 2.0 per cent over the quarter and an increase of 10.3 per cent compared to the March quarter 2019.
Western Australia’s average loan size is 16.4 per cent lower than the national average.
Tasmania
Housing affordability in Tasmania declined over the March quarter with the proportion of income required to meet home loan repayments increasing to 29.6 per cent, an increase of 0.4 percentage points over the quarter and an increase of 2.8 percentage points from the March quarter 2019.
Rental affordability in Tasmania also declined over the quarter with the proportion of income required to meet median rents increasing to 30.5 per cent, an increase of 0.5 percentage points over the quarter and an increase of 1.2 percentage points compared with the March quarter 2019.
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The number of first home buyers in Tasmania decreased to 564, a decrease of 0.5 per cent over the quarter but an increase of 11.9 per cent compared to the same quarter of the previous year.
Of all Australian first home buyers over the quarter, 2.1 per cent were from Tasmania while the proportion of first home buyers in the state’s owner-occupier market was 32.6 per cent.
The average loan to first home buyers increased to $302,128, an increase of 3.6 per cent over the quarter and an increase of 6.2 per cent compared to the March quarter 2019.
The total number of new loans for dwellings in Tasmania decreased to 1,732, a decrease of 8.3 per cent over the quarter and a decrease of 16.0 per cent compared to the corresponding quarter 2019.
The average loan size increased to $343,649, an increase of 2.8 per cent over the quarter and an increase of 21.0 per cent compared to the same time last year.
Tasmania continues to have the lowest average loan size across the country. Tasmania’s average loan size is 29.3 per cent lower than the national average.
Northern Territory
Housing affordability in the Northern Territory improved with the proportion of income required to meet loan repayments decreasing to 20.2 per cent in the March quarter, a decrease of 0.8 percentage points over the quarter and a decrease of 1.5 percentage points when compared to the March quarter 2019.
Rental affordability in the Northern Territory improved over the quarter with the proportion of income required to meet the median rent decreasing to 20.6 per cent, a decrease of 0.6 percentage points over the quarter and a decrease of 0.3 percentage points compared to the March quarter 2019.
The number of loans to first home buyers in the Northern Territory decreased to 200, a decrease of 8.7 per cent over the March quarter but an increase of 10.5 per cent compared to the March quarter 2019.
Of all Australian first home buyers over the quarter, 0.7 per cent were from the Northern Territory while the proportion of first home buyers in the Territory’s owner-occupier market was 44.9 per cent.
The average loan size to first home buyers increased to $366,500, an increase of 7.3 per cent over the quarter and an increase of 5.0 per cent compared to the March quarter 2019.
The number of new loans in the Northern Territory decreased to 445, a decrease of 15.1 per cent over the quarter but an increase of 6.7 per cent compared to the March quarter 2019.
The average loan size decreased to $346,517, a decrease of 2.6 per cent over the quarter but an increase of 1.8 per cent compared to the March quarter 2019. The Northern Territory’s average loan size is 28.7 per cent lower than the national average.
Australian Capital Territory
Housing affordability in the Australian Capital Territory improved over the March quarter with the proportion of income required to meet home loan repayments decreasing to 21.2 per cent, a decrease of 1.1
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percentage points over the quarter and a decrease of 0.5 percentage points compared to the corresponding quarter 2019.
Rental affordability in the Australian Capital Territory declined over the March quarter with the proportion of income required to meet the median rent increasing to 19.0 per cent, an increase of 0.2 percentage points over the quarter but remained stable compared to the March quarter 2019.
The number of loans to first home buyers in the Australian Capital Territory decreased to 613, a decrease of 22.2 per cent over the quarter but an increase of 57.6 per cent compared to the March quarter 2019.
Of all Australian first home buyers over the quarter, 2.3 per cent were from the Australian Capital Territory while the proportion of first home buyers in the Territory’s owner-occupier market was 32.6 per cent.
The average loan for first home buyers increased to $446,330, an increase of 4.8 per cent over the quarter and an increase of 14.8 per cent compared to the corresponding quarter 2019.
The number of loans in the Australian Capital Territory decreased to 1,883, a decrease of 20.9 per cent over the quarter but an increase of 20.9 per cent compared to the March quarter 2019.
The average loan size decreased to $458,471, a decrease of 3.8 per cent over the quarter but an increase of 6.8 per cent compared to the March quarter 2019.
The Australian Capital Territory’s average loan size is 5.7 per cent lower than the national average.
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Housing affordability improves marginally in the March Quarter: REIA

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EXPERT OBSERVER
There are always some businesses and individuals that do well out of a downturn, and the same can be said for property.
Some markets will be hit but not every market will be impacted in the same way.
While it is still very uncertain how much prices will fall, rising unemployment and problems in the rental market suggest that eventually they will.
The areas most at risk are those that feature large amounts of rental apartments. In contrast, premium suburbs and big homes on big blocks are still seeing high levels of activity on realestate.com.au and a drop in listings suggests bargain hunters may be disappointed.
While falling home values usually improve affordability, it is only helpful if people are still in a financially secure position to purchase them.
Without a job, cheap housing is still unaffordable.
Without a secure job, banks may be less inclined to lend. We’re yet to see the impact of COVID-19 on house prices, and while we can safely assume that they won’t rise in the next few months, they won’t necessarily fall by a meaningful amount either.
NERIDA CONISBEE <a href="https://www.realestate.com.au/news/author/nerida-conisbee/" target="_blank">is the chief economist for the REA Group</a>
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COVID-19 is unlikely to improve housing affordability: REA's Nerida Conisbee

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GUEST OBSERVATION
Despite two years of housing market cooling in Sydney and Melbourne, Australia stayed near the top of the global unaffordability league in 2019. And with prices rebounding in our two largest cities, that status is likely to be reinforced in 2020. Australia’s 30-year housing affordability decline has been among the worst in the developed world.
This problem is <a href="https://www.tandfonline.com/doi/full/10.1080/02673037.2011.616994" target="_blank">fundamentally structural</a> – not cyclical – in nature. Yes, periodic turbulence affects prices and rents. And yes, market conditions vary greatly from place to place. Australia-wide, though, there is an underlying dynamic that – over the medium to long term – is driving housing affordability and rental stress in one general direction only: for the worse.
<a href="https://images.theconversation.com/files/315152/original/file-20200213-41678-12hohlt.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/315152/original/file-20200213-41678-12hohlt.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt=""></a>
<a class="source" href="https://www.propertyobserver.com.au/https://www.palgrave.com/gp/book/9789811507793" target="_blank">Palgrave Macmillan</a>
Certain key factors in Australian housing woes are, of course, far from unique. As we argue in <a href="https://www.propertyobserver.com.au/https://www.palgrave.com/gp/book/9789811507793" target="_blank">our new book</a>, neoliberal policy dominance and the <a href="https://theconversation.com/explainer-the-financialisation-of-housing-and-what-can-be-done-about-it-73767" target="_blank">financialisation of housing</a> have damaged housing system performance in <a href="https://theconversation.com/housing-policy-reset-is-overdue-and-not-only-in-australia-112835" target="_blank">many other countries</a> as well. Similarly, cheap debt has supercharged house prices globally, not just here. And ours is not the only comparable nation where coping with rapid population growth is part of the policy challenge.
But, as we show in our book, over the past 30 years across 18 OECD countries, our market has had the third-biggest fall in house price affordability – and the largest of any major OECD nation.
In Australia, the focus of concern is often on the <a href="https://theconversation.com/first-home-buyer-schemes-arent-enough-to-meet-young-adults-housing-aspirations-121431" target="_blank">challenges aspiring first-home buyers face</a>. Although important, this shouldn’t distract policymakers from the bigger policy problem: <a href="https://theconversation.com/private-renters-are-doing-it-tough-in-outer-suburbs-of-sydney-and-melbourne-120427" target="_blank">affordability stress affecting lower-income renters</a>.
Being pushed into poverty by high rents is a serious issue. It affects <a href="https://www.propertyobserver.com.au/https://www.palgrave.com/gp/book/9789811507793" target="_blank">well over a million Australians</a>. That’s many more than the <a href="https://theconversation.com/small-but-well-formed-the-new-home-deposit-scheme-will-help-and-its-unlikely-to-push-up-prices-117073" target="_blank">marginal first-home-buyer cohort</a>.
<a href="https://images.theconversation.com/files/315157/original/file-20200213-41683-5tfu2t.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/315157/original/file-20200213-41683-5tfu2t.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
<a class="source" href="https://theconversation.com/private-renters-are-doing-it-tough-in-outer-suburbs-of-sydney-and-melbourne-120427" target="_blank">Source: Private renters are doing it tough in outer suburbs of Sydney and Melbourne/The Conversation</a>
<h2>Systemic problems have very broad impacts</h2>
Financial regulators and policymakers are starting to realise housing system under-performance doesn’t just <a href="https://theconversation.com/is-this-a-housing-system-that-cares-thats-the-question-for-australians-and-their-new-government-117311" target="_blank">damage the welfare</a> of key population groups. It also <a href="https://theconversation.com/is-social-housing-essential-infrastructure-how-we-think-about-it-does-matter-110777" target="_blank">raises concerns about economic productivity</a> and <a href="https://theconversation.com/four-ways-an-australian-housing-bubble-could-burst-76505" target="_blank">systemic financial risk</a>.
Even from a narrow “cost to government” perspective, the Australian government should treat current housing system trends as a serious budgetary concern because of impacts on future public spending.
For example, <a href="https://theconversation.com/retiree-home-ownership-is-about-to-plummet-soon-little-more-than-half-will-own-where-they-live-115255" target="_blank">declining home ownership</a> among younger and middle age groups will filter through to older age groups over time. Increasing numbers of older, <a href="https://theconversation.com/private-renters-are-doing-it-tough-in-outer-suburbs-of-sydney-and-melbourne-120427" target="_blank">lower-income, private renters</a> will <a href="https://www.aist.asn.au/Media-and-News/News/" target="_blank">generate political pressure</a> to boost <a href="https://www.servicesaustralia.gov.au/individuals/services/centrelink/rent-assistance" target="_blank">Rent Assistance</a> and the <a href="https://www.servicesaustralia.gov.au/individuals/services/centrelink/age-pension" target="_blank">Age Pension</a>. And <a href="https://www.aist.asn.au/Media-and-News/News/" target="_blank">pensioner numbers will be inflated</a> if rising numbers of home owners who reach retirement age with mortgages draw on superannuation savings to pay off their debt.
<a href="https://images.theconversation.com/files/296993/original/file-20191015-98661-b2ne0v.PNG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/296993/original/file-20191015-98661-b2ne0v.PNG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
The number of private renters has grown as the proportions of owner occupiers and public housing tenants have fallen. <a class="source" href="https://www.pc.gov.au/research/completed/renters/private-renters.pdf" target="_blank">Vulnerable Private Renters: Evidence and Options, Productivity Commission</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/" target="_blank">CC BY</a>
<h2>Why do we need system-wide change?</h2>
As we argue in our book, housing policy needs to be much more broadly conceived. It’s about much more than “housing programs”. Indeed, housing outcomes in Australia over the past 25 years have been driven far more by policy on tax, finance and regulation – activities rarely controlled by any department with housing in its title – than by explicit spending on housing or subsidies.
Because housing is a system, any serious attempt to improve housing outcomes must recognise the need for system-wide analysis and transformation.
Micro-measures have been the <a href="https://www.tandfonline.com/doi/abs/10.1080/02673037.2015.1044948" target="_blank">preferred approach</a> of most Australian governments over the past 25 years. But these often generate minimal net benefit or are <a href="https://www.google.com/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=1&amp;cad=rja&amp;uact=8&amp;ved=2ahUKEwjKi9vC2qLnAhXyjOYKHXvSDhYQFjAAegQIAxAB&amp;url=https%3A%2F%2Fwww.aph.gov.au%2FDocumentStore.ashx%3Fid%3D99cfa3f6-858f-467d-91a9-31e384534a5e%26subId%3D31798&amp;usg=AOvVaw3nBV95LNjlwdZiDyeAp7tN" target="_blank">even counterproductive</a>.
A national housing strategy is long overdue. And only the Commonwealth can lead this. The Commonwealth and its agencies – not the states – control key instruments driving housing outcomes, especially tax and social security settings, as well as financial regulation.
As national governments recognised in the early 1990s and from 2007-10 – and indeed exemplified by the Turnbull government’s 2018 <a href="https://theconversation.com/government-guarantee-opens-investment-highway-to-affordable-housing-88549" target="_blank">National Housing Finance and Investment Corporation</a> – the constitutional designation of state and territory responsibility for housing and planning is no bar to this.
What are the priorities for a national strategy?
A key goal must be to discourage speculation in land and housing. This would include a phased restructure of tax settings that incentivise unproductive housing over investment. For example, <a href="https://grattan.edu.au/wp-content/uploads/2018/03/901-Housing-affordability.pdf" target="_blank">most housing economists agree</a> investor landlord tax concessions should be wound back and a <a href="https://www.theage.com.au/politics/federal/it-s-just-a-bad-tax-former-treasury-heads-unite-to-slam-stamp-duty-20200216-p541aq" target="_blank">broad-based land tax should gradually replace stamp duty</a> on housing sales.
The strategy must also aim to increase diversity in the housing market. Expanding the scale of government and non-profit housing provider activity can boost the capacity to better house disadvantaged groups. It will also <a href="https://theconversation.com/build-social-and-affordable-housing-to-get-us-off-the-boom-and-bust-roller-coaster-113113" target="_blank">reduce vulnerability to damaging market volatility</a> arising from the overwhelming reliance on for-profit developers building for individual buyers.
To repair the hollowing-out of housing policy-making capability within governments, the plan should include institutional reform and capacity-building. Both levels of government should have a dedicated cabinet-level housing minister to champion the housing cause across departments. We also need an enduring national agency like the US Department of Housing and Urban Development or the former UK Housing Corporation.
<h2>Start small and build up to far-reaching action</h2>
Our insistence on system-wide analysis and reform might seem utopian, especially given the current state of Australian politics. There are parallels here to the challenges of climate change: many might ask how much worse things have to get before active policy action becomes irresistible as a bipartisan commitment.
In the absence of immediate system-wide action on housing, <a href="https://www.propertyobserver.com.au/https://www.palgrave.com/gp/book/9789811507793" target="_blank">we can also point</a> to initial reforms that Australian governments could easily adopt with minimal direct budgetary impact.
State and territory governments could, for example, follow many comparable countries in adopting planning system <a href="https://theconversation.com/england-expects-40-of-new-housing-developments-will-be-affordable-why-cant-australia-94581" target="_blank">rules that set minimum levels of affordable housing</a> that must be built within market housing developments.
In the realm of tenants’ rights, other states could <a href="https://www.tenantsvic.org.au/media/media-releases/rental_fairness_package_oct2017/" target="_blank">follow Victoria</a> in <a href="https://theconversation.com/an-open-letter-on-rental-housing-reform-103825" target="_blank">rebalancing residential tenancy laws</a> away from their typically in-built landlord advantage. “No grounds evictions” should be outlawed.
The Commonwealth could restore the pre-1996 rules of its longstanding <a href="https://theconversation.com/the-new-national-housing-agreement-wont-achieve-its-goals-without-enough-funding-99936" target="_blank">National Housing Agreement</a> with the states and territories which largely ringfenced federal funding to supply and improve social housing. All governments could commit to delivering a substantial proportion of affordable housing within residential developments on ex-government land. Many industry stakeholders advocate a <a href="https://www.domain.com.au/news/calls-for-higher-affordable-housing-targets-as-more-people-on-cusp-of-poverty-20170802-gxo11s/" target="_blank">30% target</a>.
We see scope for a phased approach: first-step measures could be implemented while building the political consensus needed for more far-reaching actions. To improve affordability and moderate the <a href="https://theconversation.com/how-the-housing-boom-is-remaking-australias-social-class-structure-66976" target="_blank">rising inequities within</a> and <a href="https://theconversation.com/for-the-first-time-in-a-long-time-were-setting-up-a-generation-to-be-worse-off-than-the-one-before-it-121983" target="_blank">between generations</a>, Australia’s housing system must be fundamentally reformed. There is no responsible “business as usual” option.
<a href="https://www.propertyobserver.com.au/https://www.palgrave.com/gp/book/9789811507793" target="_blank">Housing Policy in Australia: A case for system reform</a> by Hal Pawson, Vivienne Milligan and Judith Yates was published by Palgrave Macmillan this month.<img src="https://counter.theconversation.com/content/130291/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
<a href="https://theconversation.com/profiles/hal-pawson-147969" target="_blank">Hal Pawson</a>, Professor of Housing Research and Policy, and Associate Director, City Futures Research Centre, <a href="https://theconversation.com/institutions/unsw-1414" target="_blank">UNSW</a>; <a href="https://theconversation.com/profiles/judith-yates-148000" target="_blank">Judith Yates</a>, Honorary Associate Professor, School of Economics, <a href="https://theconversation.com/institutions/university-of-sydney-841" target="_blank">University of Sydney</a>, and <a href="https://theconversation.com/profiles/vivienne-milligan-147970" target="_blank">Vivienne Milligan</a>, Honorary Professor – Housing Policy and Practice, City Futures Research Centre, <a href="https://theconversation.com/institutions/unsw-1414" target="_blank">UNSW</a>
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/australias-housing-system-needs-a-big-shake-up-heres-how-we-can-crack-this-130291" target="_blank">original article</a>.
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