Housing affordability marginally improved, while rental affordability dropped across the country in the March quarter. Trends in the states and territories were varied, according to research from the Real Estate Institute of Australia and Adelaide Bank.

The Adelaide Bank/REIA Housing Affordability Report for March found that the Northern Territory was the only area that did not record an increase in housing affordability. New South Wales, on the other hand, posted the largest improvement with a 1.3% decrease in home loan repayments.

Rental affordability improved marginally in the larger states of New South Wales, Victoria, and Queensland, as well as in Western Australia and the Northern Territory. However, a huge slide in rental affordability in South Australia and Tasmania offset the improvement, leading to an overall decline in rental affordability nationally.

A look at the different states

NSW

Housing affordability in New South Wales rose, with the proportion of income needed to meet loan repayments dropping by 1.3 percentage points to 35.4% over the March quarter. Year-over-year, the proportion of income required to meet monthly loan repayments decreased by 1.1 percentage points.

Rental affordability improved marginally in the state, with the proportion of income required to meet median rent payments decreasing to 28.2% — down by 0.1 percentage points over the March quarter and 1.9 percentage points compared with the March quarter 2018.

VIC

Housing affordability climbed in Victoria, with the proportion of income required to meet loan repayments declining by 0.6 percentage points to 32.5% over the March quarter. The proportion of income required to meet monthly loan repayments decreased by 1.6 percentage points compared to the same quarter of the previous year.

Rental affordability in the state also rose, with the proportion of income required to meet median rent decreasing marginally to 23.1%, a decrease of 0.1 percentage points over the quarter and 0.7 percentage points compared with the March quarter 2018.

QLD

Housing affordability in Queensland improved, with the proportion of income required to meet loan repayments sliding to 27.5%— down by 0.6% over the quarter but remaining steady compared to the same quarter last year.

Rental affordability also increased, with the proportion of income required to meet the median rent dropping to 22%, marking a decrease of 0.1 percentage points over the quarter and a decrease of 1.1 percentage points over the past year.

SA

Housing affordability in South Australia increased, with the proportion of income required to meet monthly loan repayments decreasing to 26.9% — down by 0.6 percentage points over the quarter and 0.3 percentage points compared to the same period a year ago.

Rental affordability declined, with the proportion of income required to meet average rent payments increasing to 22.8%— up by 0.8 percentage points over the quarter and an increase of 0.4 percentage points compared to the same quarter in 2018.

WA

Housing affordability in Western Australia improved, with the proportion of income required to meet loan repayments decreasing to 22.6%, marking a drop of 0.5 percentage points over the quarter and a decrease of 1 percentage point over the previous year.

Rental affordability in the state also rose, with the proportion of income required to meet the median rent decreasing to 16.5%, — down by 0.1 percentage points over the quarter. Rental affordability, though, dropped over the past year with proportion of income required to meet median rent increasing 0.2 percentage points.

TAS

Housing affordability in Tasmania climbed, with the proportion of income required to meet loan repayments sliding to 25.4%, marking a decrease of 0.9 percentage points over the quarter. Year-over-year, housing affordability has declined with proportion of income required to meet monthly loan repayments increased by 0.9 percentage points.

Rental affordability, on the other hand, declined with the proportion of income required to meet median rents increasing to 29.3%— up by 1.2 percentage points over both the quarter and when compared to the same period in 2018.

NT

Housing affordability in the Northern Territory declined with the proportion of income required to meet loan repayments increasing to 20.2%— up by 0.8 percentage points over the quarter and an increase of 0.4 percentage points when compared to the March quarter 2018.

Rental affordability rose, with the proportion of income required to meet the median rent decreasing to 20.9% — down by 0.4 percentage points over the quarter and 1.6 percentage points over the previous year.

ACT

Housing affordability in the Australian Capital Territory improved, with the proportion of income required to meet loan repayments decreasing by 0.3 percentage points to 20.3% over the quarter.

Rental affordability has slid, with the proportion of income required to meet the median rent increasing to 19%— up by 0.1 percentage points over the quarter and an increase of 0.5 percentage points over the past year.