Thinking of moving to Oz? Think again
Sunday Star Times | Sunday, 28 January 2007
Homes are even less affordable in many parts of Australia, reports Greg Ninness.
Kiwis considering moving to Australia may need to think twice if their plans include owning their own home.
Because while rising house prices are making home ownership increasingly less affordable in this country, the situation is even worse in many parts of Australia.
The Demographia Survey of Housing Affordability released last week shows the median dwelling price in Auckland was 6.9 times the median household income in the region (as at the September quarter last year).
Home buyers in Wellington and Christchurch fare slightly better, where median prices are 5.4 times and six times median household incomes.
But people thinking they may improve their chances of owning their own home by jumping across the ditch to Australia may be disappointed.
About 34,000 New Zealanders move to Australia on a permanent or long-term basis each year, many attracted by what they see as better career and lifestyle opportunities.
The UK is the second biggest destination, attracting about 12,000 a year.
But if they are heading for the bright lights of Sydney, long a mecca for young Kiwis, they could be in for a rude awakening.
Sydney has one of the most expensive housing markets in the world, with median prices being 8.5 times median incomes, making the city marginally more expensive than London, according to the Demographia survey.
And the problem is not confined to Australia's largest city.
Western Australia's mining boom has made Perth, once one of the most affordable Australian cities, the second least affordable after Sydney - and most other Australian cities are catching up fast.
The trend was confirmed last week when Australia's Housing industry Association released its Housing Affordability Index figures for the December quarter of last year.
The index breaks out figures for first home buyers. These showed a first home became 5.5% less affordable in the December quarter and and was 15.5% less affordable than it was a year before.
The study blamed a double whammy of rising prices and rising mortgage interest rates for pushing affordability to its lowest level since the index was launched in 1984.
Some believe the cost of housing in the big cities is so high it is starting to affect middle income earners as well as first home buyers.
Australia's opposition housing spokeswoman Tanya Plibersek said cities such as Sydney and Perth could face shortages of key workers such as teachers, nurses and police, because they could not afford the housing costs.
"They'll find it almost impossible to afford to live within commuting distance of their work," she said.
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