- January 22, 2010
- Posted by: admin
- Category: Finance News
Australian house prices are not as expensive as what is currently perceived, new data from Rismark has found.
Rismark managing director Christopher Joye said there had been no discernible increase in Australian house prices relative to disposable incomes since the end of the last boom in 2003.
“In contrast to claims that Australian house prices are seven to eight times greater than the average income, Rismark’s National Dwelling Price-to-Income Index implies that the true ratio across all regions and all property types is around half this estimate,” Mr Joye said.
“This suggests that Australian housing is not as expensive as is commonly believed. It also reconciles with RBA analysis highlighting Australia’s internationally low mortgage default and mortgage stress rates.”
According to the quarterly Rismark National Dwelling Price-to-Income Index released today, Australian home values rose robustly by 11 per cent in 2009, while the Price-to-Income Index has risen from its low of 3.7x in December 2008 to 4.1x as at the third quarter of 2009.
Over the last six years, Rismark’s National Dwelling Price-to-Income Index has remained broadly static after solid growth during the early 2000s. In December 2003 Australian dwelling prices were 4.2 times that of the average disposable income, which is effectively where they remain today.
Source The Adviser