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House prices dropped across several Australian capital cities in recent months, with major banks predicting falls of ۲–۳% by the end of the year.
But after a decade of accelerating house prices, this wouldn’t make a significant dent in housing affordability.
Monthly data from Cotality shows the median price of a dwelling in Australia peaked at $۹۴۴,۰۰۰ in March, retreating to $۹۳۷,۰۰۰ by the end of June – a ۰.۷% drop. But over the past ۱۰ years the median home price has risen more than $۴۰۰,۰۰۰.
Another way of thinking about house prices is in terms of how long they would take to pay off. In ۲۰۱۶, the average dwelling price in Australia was equal to ۱۳ years and four months of a typical household’s disposable income, Guardian Australia columnist Greg Jericho has calculated.
By March this year, the equivalent figure had risen to more than ۱۷ years. Even with a ۱۰% drop from the March peak, the median dwelling would cost more than ۱۵ years of a household’s disposable income.
