Melbourne housing now country's least affordable
Melbourne has been named as the country's least affordable city for potential home buyers.
The HIA-Commonwealth Bank Housing Affordability Index, which is based on the combined impact of interest rates, property prices and household incomes, rated Melbourne bottom with 50.8 points.
Sydney was found to be the next least affordable city for home buyers with an index rating of 51.5, followed by Perth on 54.9 and Brisbane on 58.1.
Hobart, meanwhile, was judged to be the country's most affordable city with an index rating of 71.9.
HIA's chief economist Dr Harley Dale commented that Melbourne's lower wages and increasing property prices had severely impacted on housing affordability.
"Melbourne had a strong surge in home prices up until quite recently and that surge was far greater than anything we've seen elsewhere," he said.
"It has caused a considerable problem in terms of affordability."
Prospective buyers struggling to secure a property can choose to compare home loans in search of the best deals. Earlier this week, a report on the Australian mortgage market by Fitch Ratings showed that the proportion of 'low-doc' home loan borrowers falling behind with their repayments has hit a record high.
This article is brought to you by Mozo – Helping you compare home loans