Fewer Aussie homes owned outright

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New census data has revealed that fewer homes were owned outright in 2006 than in 1996 leading some industry players to cite the survey as more evidence of a growing affordability crisis.

The survey shows that the proportion of fully-owned homes has decreased from 41% to 33% during that time while the proportion being purchased with a mortgage has increased from 26% to 32%.

This clear shift from fully-owned to being purchased (still mortgaged) has concerned some commentators.

Graham Joyce, president Real Estate Institute of Australia (REIA), said: "Some effort has been made by some state governments to address affordability issues, but more must be done. This should serve as a serious warning."

Data from the Australian Bureau of Statistics (ABS) shows that Tasmania had the highest proportion of occupied private dwellings in 2006 at 37% and the Northern Territory the lowest at 17% - it also had the highest number of rented dwellings at 42%.

It also shows that median monthly housing loan repayments of occupied dwellings being purchased increased from $780 in 1996 ($1011 in 2006 with inflation) to $1300. New South Wales had the highest median monthly loan repayments of all the states at $1517, while Tasmania had the lowest at $867.

Figures from the census used by CommSec in its economic report confirm the affordability issues.

It highlighted the fact that median household incomes rose 61.2% during the 10 year period, while the average mortgage was up 66.6%. Home loan repayments took 31.6% of household income in 2006, compared to 27.7% in 2001.

Joyce has listed some suggested solutions to the problem that he believes governments should take note of.

"There are some immediate actions that federal, state and territory governments should take. These include reducing or abolishing state property taxes, reversing the shift of infrastructure development charges to individual home buyers from the general tax base, addressing land supply constraints, increasing the First Home Owner's Grant to $14,000 and index-linking it to median house prices."

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