The WebThis site

WHO WE ARE COSTINGS CONTACT US OUR VISION REGISTER

 

HOUSING IN WESTERN AUSTRALIA

 

WA: Housing affordability falls and 'will get worse'

Courtney Trenwith

 

Housing affordability in WA has declined and is likely to only worsen this year, according to research by the real estate industry.Housing affordability in WA fell 1.2 percentage points in the March quarter, with WA and the Northern Territory the only areas to go backwards, a Real Estate Institute of Australia report shows.

 

The proportion of family income required to meet home loan repayments in WA is now 24.1 per cent, the report says. It is marginally better than a year ago.

 

The average loan in WA increased to $305,800 - about 2.5 per higher than in the December quarter and 2.1 per cent up on the March quarter last year. Fewer new loans were committed to, down 0.6 per cent to 12,018, although that was 10 per cent more than the same time last year.

 

Australian Bureau of Statistics figures released today show the number of finance commitments fell even further in April, down 1.2 per cent. Real Estate Institute of WA deputy president Ian Cornell said housing affordability in WA was expected to worsen this year because of a dramatic decline in new home building approvals.

 

Building approvals plummeted by 46.7 per cent in April, according to the ABS, prompting emergency meetings between the government and industry. The slump has been attributed to the state's new Building Act, which came into play on April 2 and has caused confusion among developers and local government authorities in charge of approvals, drastically slowing down the process.

 

"If this persists for a few more months we will see a fall in new dwelling starts for both the June and September quarters," Mr Cornell said. "This will ultimately lead to a supply imbalance that will, in turn, put pressure on established housing. The knock-on effect will ripple through the existing residential housing market and put price pressure on both buyers and renters for the latter half of 2012.

 

"Ultimately, this means that the increased competition for houses and rental properties on the market will push up the prices for both as we move into spring." Housing Industry Association WA director John Dastlik said without quick reforms the downturn in building approvals would have long-term effects. He was confident blockages in the approvals process could be resolved soon. If so, the number of new dwellings would not be affected but they would be delayed.

 

"Sales in the new home market are actually increasing, [but] we've got a piece of legislation which has slowed the approvals process," Mr Dastlik said. "If you continue to have very slow processes ... that can have an impact on people's decision on whether they go new or established. So in the medium- to long-term, if these sorts of issues expand the time on which to get building permits and people have to rent longer, they might make the easier decision [to buy an established home]. "That would cause the established housing prices to go up. "We need to make sure we don't have artificial impacts on housing prices in WA or rental availability and rates. You need to keep the new housing market going so we replenish the stock and increase the stock to make it more affordable."

 

According to REIWA, the number of homes for sale has significantly declined in the past year, from about 18,000 to 12,975 this week. At the same time, the number of sales has slowly increased, creating a tighter buyer's market. Mr Cornell said renters were facing even greater affordability pressures.

"The proportion of income required to meet the median rent in Perth grew by 0.7 per cent in the March quarter and now stands at almost 21 per cent," he said. Mr Cornell said higher rents were encouraging more first home buyers, with the number increasing by 4.1 per in the quarter, a significant increase of 36.4 per cent on March last year.

 

The REIA Housing Affordability Report found 3910 people bought their first home in WA during the first three months of this year. However, Mr Cornell said it was concerning that the average loan to first home buyers was up almost 3 per cent to $287,800 or by 6.5 per cent on the same time last year. WA was the only state where average loans to first home buyers increased during the quarter.

 

Crisis accommodation's crisis

Opposition housing spokesman Peter Tinley said more vulnerable people and families were turning to crisis accommodation, which was struggling to cope. "My office has been contacted regularly by people who had sought emergency housing assistance and sadly we have found that increasingly, there is no available crisis accommodation," Mr Tinley said. "The whole point of crisis accommodation is to assist people in crisis, who literally have nowhere else to go.

 

"I received an email last weekend in relation to a woman with two young children who was trying to escape domestic violence but was unable to find emergency crisis accommodation for her family.

"Social welfare agencies would attest it is extremely difficult to tell people seeking assistance that there is no help available because services are full."

 

Moreover, he said creeping housing affordability was no longer only affecting vulnerable families, but working families were increasingly becoming the face of WA's homeless population. "WA is experiencing a housing affordability crisis and many working families are simply unable to afford increased rents," he said.

He said the government's recently announced 10-bed shelter for homeless men fell far short of what is required to address the crisis.

 

Housing Minister Troy Buswell and Commerce Minister Simon O'Brien, who was instrumental in the new Building Act, have been contacted for comment. (source: http://www.domain.com.au/ )

 

*******************************************************************************

Fears housing affordability crisis brewing across WA

Posted June 21, 2012 14:19:32

 

The Western Australian Opposition says the State Government needs to take action to solve a housing affordability crisis, with more than 50,000 residents on the Homeswest waiting list. Labor's housing spokesman, Peter Tinley, says people who could once afford private rentals or their own home are now being forced to turn to public housing due to rising costs. He says there are more than 2,200 people on the waiting list in the mid-west and Gascoyne, more than 3,000 people in the wheatbelt, more than 2,600 people in the south-west, more than 1,500 in the Great Southern and more than 1,700 in the Pilbara.

Mr Tinley has accused the Minister for Housing, Troy Buswell, of not doing enough to solve the problem.

"Because there's such a housing shortage, rents are just through the roof, so there's no opportunity for these people who are working ... what I would call the working poor ... who have no capacity to actually get into the private rental [market], let alone home ownership," he said.

 

"It's just becoming too difficult. "The Government needs to be very serious about funding public housing correctly and not wasting money. "Population in Western Australia is not decreasing, it won't be a feature of our future. We'll be an increasing population all over the place. "We need to take that seriously and fund properly the expectation that people have for looking after some of the most vulnerable people in our community."

 

Mr Buswell says there are only about 23,000 people registered on the public housing waiting list as at May 2012, which is fewer than last year. He says the Government is continuing work on its State Affordable Housing Strategy, which aims to deliver at least 20,000 new Homeswest homes by 2020.

 

Mr Buswell says the Government has constructed more than 3,000 new public housing dwellings in three-and-a-half years.  (source ABC News)

 

************************************************************************************************************