Money: Victorians spending more income on housing costs than rest of the nation - PressFrom - Australia
  •   
  •   

MoneyVictorians spending more income on housing costs than rest of the nation

21:30  17 july  2019
21:30  17 july  2019 Source:   theage.com.au

Not a game changer: Retailers concerned customers won’t spend new tax cut

Not a game changer: Retailers concerned customers won’t spend new tax cut The government passed an income tax cut last week to stimulate the economy, but business owners aren't waiting with bated breath.

Victorians spending more income on housing costs than rest of the nation© Joe Armao Victorians spend more income on housing than people in other states.

Housing costs are biting harder in Victoria than anywhere else in Australia, with homeowners spending more of their income on mortgage repayments here than in any other state.

New data from the Australian Bureau of Statistics also reveals Melbourne homeowners spend a greater proportion of their gross household income on housing costs than any other Australian capital city, including Sydney.

Economists attributed the result to a mixture of lower average incomes and faster population growth in Melbourne than in Sydney.

Minister for Housing Luke Howarth wants a 'positive spin' on homelessness

Minister for Housing Luke Howarth wants a 'positive spin' on homelessness Luke Howarth, the new Assistant Minister for Community Housing, Homelessness and Community in the Morrison Government, says he wants to put a positive spin on homelessness as it affects a "very, very small percentage of the population".

The data also revealed that the state's share of renters is steadily growing as rising home prices present a growing barrier to home ownership.

In the past 20 years, the proportion of Victorians who rent has grown from 22.45 per cent to 29.9 per cent, while the proportion who own a home outright or are paying off a mortgage has fallen from 77.55 per cent to 70 per cent.

But Victorian renters are spending even more of their gross household income on housing costs than homeowners, the data shows: renters spend 20.1 per cent on average on housing costs, compared with 16.7 per cent for those paying off a mortgage.

The national average for mortagage payers is 15.9 per cent.

The Melbourne average is 16.9 per cent of gross household income, compared with 16.6 per cent in Brisbane, 16.5 per cent in Perth and 14 per cent in Sydney.

The new housing bubble threat to ASX banking shares that isn’t from Australia

The new housing bubble threat to ASX banking shares that isn’t from Australia The threat of a popping housing bubble in this country has receded substantially but worries about another over-heated housing market could haunt the big four ASX banks. The countries most at risk of house price correction are Canada and New Zealand, according to a Bloomberg report. That’s bad news for the Commonwealth Bank of Australia (ASX: CBA) share price, Australia and New Zealand Banking Group (ASX: ANZ) share price, Westpac Banking Corp (ASX: WBC) share price and National Australia Bank Ltd. (ASX: NAB) share price.

Mortgage repayment costs and rental costs both hit a record high in Victoria in 2017-18, according to the bureau’s Survey of Income and Housing, published on Wednesday.

Homeowners who do not fully own their home paid $487 a week on housing costs on average, compared with $366 a week for renters.

Bruce Hockman, chief economist at the ABS, said homeowners in Sydney typically earned higher average wages than Melburnian homeowners, while the difference in mortgage size was marginal.

"The average mortgage in Sydney is $265,000; the average mortgage in Melbourne is $260,000," Mr Hockman said.

"The reason for the ratios being different is that incomes on average are higher in Sydney than they are in Melbourne."

Professor John Daley, chief executive of economic think thank the Grattan Institute, said Melbourne’s rapid population growth was also a factor, because it created greater demand for new housing than in any other city.

The rise and fall of the starter home — why millennials are choosing to rent instead of own

The rise and fall of the starter home — why millennials are choosing to rent instead of own Starter homes used to be seen as a great way for young people to stop paying monthly rent, build equity, and save up for a larger home. 

"Melbourne has had materially higher population growth than Sydney and so you push demand up faster," Professor Daley said. "So then you would expect that, relative to incomes, prices for housing would go up more."

The Andrews government spruiked its first home buyer grants scheme on Tuesday, releasing new figures that show more than 62,000 new homeowners have claimed stamp duty concessions and exemptions in the past two years.

The concessions - which apply only to first homes costing $750,000 or less - have saved first-time homeowners more than $1.1 billion.

Treasurer Tim Pallas said the data showed the scheme had made home ownership more affordable for tens of thousands of people.

"The government’s initiatives in this space were unashamedly about helping people get on to that first rung of home ownership," he said.

But Professor Daley said stamp duty concessions did nothing to reduce housing costs, only serving to push up demand and therefore property prices.

"All they do is increase demand, they don’t do anything to increase supply and you can see that in Melbourne," he said.

"What has happened is that prices in outer suburbs, which is where first home owners are the only people who qualify for those [concessions], have gone up much faster than anywhere else and have stayed higher than anywhere else."

Savings rates hit rock bottom amid signs of further spending restraint.
Deposit rates fall to new lows with all banks as signs grow of continued retail headwinds.

—   Share news in the SOC. Networks

Topical videos:

usr: 0
This is interesting!