Home loans customers 'struggle to afford available houses'

Friday 08 July 2011

Article by Mozo

Australia does not have a shortage of properties at the moment, the problem is that prices are too high for home loans customers, according to one expert.

Affordable houses 'hard to come by'

Dr Ed Shann, director of Prime Value Asset Management, said in a piece for the Herald Sun that either prices have to fall or Aussie incomes need to increase.

"There is no housing shortage at current prices. There is a shortage of affordable housing. If house prices fell, more people could then afford to buy a house," he stated.

He claimed that if interest rates are increased by the Reserve Bank of Australia later this year, then house prices are likely to stay weak.

Despite this, he asserted that he does not believe there will be a significant drop in prices any time soon unless there is another upheaval in the financial market and a surge in unemployment, which would adversely affect demand for abodes.

This comes after Greg Pride, financial planner for Centric Wealth told the Sydney Morning Herald that Aussies with a windfall should consider paying off some of their home loan.

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