Buying a house in Australia is getting pricey.
Australian house prices are rising and will continue to rise unless the Australian government steps in, warns the Housing Industry Association.
In news that will alarm those thinking of emigrating to Australia this year, house prices rose by 13.9% in the past year and it shows no sign of stopping. According to data released by the HIA, rising interest rates are making mortgages unaffordable and it is predicted that by June, Australian housing affordability will have reached record lows.
Critics of the Australian immigration program will warn that the housing crisis is a sign that Australia is struggling to cope with a rapidly growing population. Whilst others blame a demand and supply mismatch in the housing market.
City dwellings are amongst the most expensive in Australia because of high demand. Just a few months ago we reported on the trend of expensive suburban properties being snapped up by wealthy Chinese parents keen to give their children an Australian education. So widespread was the practice in cities like Sydney and Melbourne that new estate agents started popping up to offer their services for these buyers only.
The government stepped in then and tightened the rules on foreign property purchasers. In legislation that also affects British migrants to Australia, tough rules about the type of property foreigners could buy were imposed. Temporary migrants must now seek permission to buy a home in Australia and must sell their home once they leave. Foreign investors buying from abroad will be limited to buying new properties only.
Yet these measures have not stopped rising house prices. Coupled with rising interest rates it is now increasingly difficult for first time buyers in Australia to be able to afford their own home. It is a situation very similar to recession-hit UK where the demand for housing has outstripped supply, leading to rising house prices even in the midst of a recession. With banks now wary about lending and interest rates high, UK first-time buyers can understand what the Australians are going through.
However even with rising prices, homes in Australia are still more affordable than in the UK and you certainly get much more for your money! So if you are thinking of emigrating to Australia, don’t be put off by rising prices, given Australia’s popularity and growing status, buying a home here is still a good investment to make.
For more information on property buying in Australia visit our relocation section where we give you an indication of house prices across Australia, the best places to look for property and all the information on what type of property a British expat can apply to buy. If you require a loan or mortgage in Australia then read our section on Australian banking.
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