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Housing affordability for first home buyers soared according to Dr. Andrew Wilson’s Housing Affordability Index.

He explains why First home buyers have it so well at present in this week’s Property Insiders video as well as pointing out a significant difference between 2 major housing data sets.

Which one is right, did property values go up or down, and does it really matter?


Before we look at the latest data it’s fascinating to look back over the last year and see what has transpired.

I remember as when the year began COVID-19 was a small and little-noticed blip in the eastern skies which quickly morphed into a once in 100-year event that led to lockdowns, social distancing, and a quick and deep fall in global as well as Australia’s GDP.

Many people feared the recession would be deep and long-lasting, but mainly due to the huge easing in fiscal and monetary policies, including an unprecedented scale of stimulus and job support, Australia’s recession was shallow and much shorter than many initially feared.

Unemployment did not rise to double digits as many forecasts it would, and about three-quarters of the jobs that were lost have since been recovered.

As forecast by Dr Andrew Wilson in these regular chats, the Australian economy bounced out of recession in the September quarter, with strong GDP growth of 3.3%.

However, what caught many by surprise was the magnitude of the economic rebound, helped by household spending rising by 7.9%.

At the same time, consumer confidence has rebounded and Aussies are more than happy to open their wallets again, but businesses have been more reserved with underlying business investment down 4.1% for the September quarter.

And as we forecast many times in our weekly Property Insiders Chat chats, our property markets remained remarkably resilient despite the economic challenges and the second wave of infection in Melbourne.

Now I don’t want to trivialise the challenges many businesses and some Australians are still facing, and even though we are out of recession, clearly the recovery will take some time.

Unemployment and underemployment are likely to persist keeping wages growth and inflationary pressures low, but the RBA has indicated it will do whatever it needs to, to get jobs growing again.

In the meantime, while some people are suffering financially, overall household savings are significantly higher than they were at the beginning of the pandemic suggesting that many households have built a healthy buffer to see them through what they anticipated would be a longer downturn.

But now that their financial future seems brighter many Australians are out spending again with more and more of them entering the property market buying their first home or upgrading their existing homes and those who can manage to get an investment loan are out in the force again too.

Dr. Andrew Wilson, chief economist of MyHousingMmarket.com.au discusses what this means for our property markets into the new year.

Watch this week’s video as we discuss:

• The latest property market data, including the trends in auction results, new listings, and property sales
• Up to date economic data including share market and Australian Dollar trends
• Dr. Wilson’s first home buyer affordability index
• How 2 house price models have delivered very different results and why this matters
• And Dr. Wilson’s commentary on these trends