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Canberra’s Boutique Real Estate and Property Management

ACT Housing the most affordable in the country?

By johnboy 7 September 2006 73

The Chief Minister is claiming that the ACT has the most affordable housing in the nation.

Now before the reality shear consumes your mind It’s worth scrolling down the page and seeing where the statistics came from. It’s the Real Estate Institute of Australia’s Home Loan Affordability Indicator and, most importantly it measures affordability on the basis of income.

So because we have higher average wages in Canberra we get to screw the lower income earners extra hard in the housing market.

What’s Your opinion?

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73 Responses to
ACT Housing the most affordable in the country?
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Big Al 8:37 am 12 Sep 06

I don’t think we Canberran’s have much to complain about in the ‘peak hour’ department. Even in heavy traffic, unless there’s a bingle or somthing, most trips are half an hour or less. Years ago I spent a year living in Sydney. The trip from my place to work was about 8km and it could take over an hour – often for no obvious reason.

VYBerlinaV8 8:30 am 12 Sep 06

I grew up in Queanbeyan, and understand the commute well. The trick is to get going earlyish, although the shortish distance means peak hour is still only perhaps 20 mins to the city. I believe there are plans for improving the roads, but I’m not holding my breath there!

I-filed 9:59 pm 11 Sep 06

“Also, QBN is closer to the centre of Canberra than quite a few parts of Canberra!” VYBerlina

Queanbeyan’s cute houses seem like a good idea till – have you tried to commute from Queanbeyan to Canberra? There’s a big disadvantage there. The traffic is so slow it must make Queanbeyanites wish they’d bought in Belconnen. Oh. Except the sun shines in your eyes all the way up Belconnen Way in the afternoon. So that’s out too!

Big Al 5:35 pm 11 Sep 06

I suspect that 5% plus outgoings is the new 20% deposit of old. 5% plus stamp duty, legals, mortgage insurance on say a $320k property would be around $35k a probable saving of around $10k on 10% deposit (assuming the lender lets you off mortgage insurance with that equity) and around $40k less than the 20% deposit of old. Then your looking at say $2k/month in minimum repayments – or a pre-tax income of around $28K that can be committed exclusively to servicing that debt. I guess affordability comes down to what other non-discretionary expenses the household has.

nyssa76 4:40 pm 11 Sep 06

5% + costs is not a good way to start.

snahon, it’s not fear, it’s wanting to make sure I have enough money after each pay to pay for the things I need i.e. food, electricity.

I’ve seen a few on allhomes and some are priced too high. Some are great.

I’ve even thought of purchasing an investment property first (2-3br) just to get into the market, which is also an option.

I’ve even looked outside the ACT and have for several months. It’s amazing that you can buy a 4br elsewhere for the price of a 2-3br here.

Do they want people to stay in the ACT? I bloody think not.

seepi 11:54 am 11 Sep 06

I do think buying is the way to go if you can do it. But I would only buy something I would be happy to live in for the next 5+ years. Property hasn’t appreciated for the last 2 or 3 years, and there is no guarantee that it will appreciate in the next couple. Whereas rates seem fairly certian to go up a bit in the future.

snahon 10:54 am 11 Sep 06


” ..could afford a mortgage too but I want to make sure that I have a decent enough deposit so as to not put myself into a situation I can’t afford. “

If you know you can already afford a mortgage then you have obviously done some homework on loans, mortgages, repayments, etc…(as one would expect of a person with 3 degrees).

So you know how much your family can afford, go and start looking. If you can’t find what you want in that price, then a re-evaluation of what you can afford is obvious.

There are many hard luck stories about how we all shared rooms when we grew up (even as teenagers) and it wasn’t such a big deal as we’ve gotten older, so your family seems to have a few choices available :

1. Find the type of house want, can afford but may not be in a location that is ideal.
2. Downgrade your expectations in your location based on existing market conditions.
3. keep renting and hope that your savings will increase at a rate faster then the housing market until all your personal requirements are met.

Many first time home owners don’t get their ideal house but many are smart enough to understand that paying someone elses mortgage is far worse then living it ‘tough’ and paying off your own asset (that actually appreciates in value).

VYBerlinaV8 10:23 am 11 Sep 06

Also, QBN is closer to the centre of Canberra than quite a few parts of Canberra!

VYBerlinaV8 10:22 am 11 Sep 06

Affordability needs to be considered in the context of expectations. If someone expects their first home to have 4 bedrooms, they should also expect to pay reasonably high $$.

As far as the 2 bedroom units in QBN go, many people might be suprised how good they are. Basic for sure, but lots of them have new carpet and paint, and many have kitchens and bathrooms less than 10 years old. I’m seriously considering buying one as an investment later this year – they are always in rental demand and the yield is larger than many other market segments.

Big Al 10:13 am 11 Sep 06

There would seem to be fairly limited supply at the ‘affordable’ end of the market. A quick search of Allhomes indicates that there are about 15 properties currently on the market under $300k – based on a search for freestanding homes with up to 4 bedrooms anywhere in Canberra – excluding Qbn and any property identified as being ‘under offer’.

That’s not a lot of choice and at the top end its arguable that repayments around $1950 a month are ‘affordable’.

Joker 10:09 am 11 Sep 06

Nyssa76, you asked me twice “when would you like me to get another job?” I don’t need you do anything for me. I’m suggesting you should think creatively about money and careers. It seems to me you have the means to accomplish what you desire the only thing that’s stopping you seems to be fear. You only need 5% + costs. Previous wisdom regarding money has changed every day your savings are eaten by inflation and interest on savings is taxed.
El – are you serious? I don’t know what you think a hovel is? I found 2 bedroom units in Queanbeyan on for $170 per week.

nyssa76 7:16 am 11 Sep 06

Thanks VY, I’ll check that out too.

VYBerlinaV8 8:46 pm 10 Sep 06

Nyssa – based on what you’ve said in this thread, it seems to me you may nearly be there. Have you considered taking a loan product that allows you to borrow 100%, but with an offset account, into which you could dump all your savings? That with the grants should give you a fairly strong cash reserve (perhaps a year or more worth of payments in the bank).
Ultimately, if you don’t want to buy a house, that’s your decision. If you really do, I think there may still be ways to set things up that would work for you. I’d be asking a mortgage broker (or 3). And well done on the savings so far.

nyssa76 4:01 pm 10 Sep 06

Mael, he wasn’t in Timor for 6 months. He’s navy not army.

So it’s like $18K (on your figures). Added on to the money I’ve already saved, to which I want more than a 10% deposit, given the current market trends and increasing interest rates. It’s called being safe. I don’t want to put myself or my husband or children into a sitution we can’t afford.

I know all that crap, again, Special G passed it on to me.

Hard done by? WTF? So saving and not taking out a 100% loan is not a good thing?

BTW your “frank financial advice” isn’t needed.

el 3:06 pm 10 Sep 06

That’s easy enough to say, Joker.

But my 2 bedroom “hovel” costs over $300 per week in rent.

Maelinar 1:12 am 10 Sep 06

Nys, we are alike in our situations.

I was in the Army and I went to Timor. After 15 years in the military, I finally had a positive bank balance for over 6 months.

So I started from scratch is the message I’m passing to you.

(Which also makes me aware of the Defence Home Buyers Grant – a further $11 grand when I applied, on top of the first homebuyers etc etc)

So go shove your hard done by story towards somebody who really cares, like DHA.

Some basic math:

Add up the following;

Defence HBG, – 11k
First Home Grant, – 7k ?
Whatever you’ve got left from Timor. – 6m tour = $75k – probably minus the cost of a Holden because I’m steriotyping

I would think very hard about rebutting my statements because any further frank financial advice will not be pleasant. Most people that move $93k in 6months tend to hang out in Casino’s or dark alleyways.

I’m already aware that the $93k is subject to several factors – however the point of the conversation is regarding fiscal potential, not actual money in hand.

seepi 10:01 pm 09 Sep 06

It shouldn’t be a choice between kids and owning a house for a two income couple.
And kids are not something you can put off forever.
Is real estate still cheaper in qbn?

Cityboy 12:23 pm 09 Sep 06

Big Al- something that stops tennants makeing an offer is money.

The Federal government does not have a considered an developed housing policy and /or programs. They may argue that it is a state responsibilty. If it is a state responsibilty why do the feds keep commenting and throwing money at it- negative gearing first home buyers grant, for example.

nyssa76 10:56 am 09 Sep 06

Special G, he’s been in around 16yrs and was in Timor earlier this year.

I’m teaching in the private system this year and go back to the govt system next year – with a pay cut…but we won’t go into that.

Thanks for that info, I’ll have to check that out too.

Special G 10:42 am 09 Sep 06

Nyssa, This should be inspiring you to back teachers up with the current wage negotiations. With a substantial pay increase you could work in either public or private schooling and afford your house.

Has your husband looked into the defence home loan. It is $80,000 with about 1/3 interest subsidised by the govt. If he has been in for long enough or has served in a combat zone (almost everyone in defence these days) then it would make him eligable.

The defence loan is currently sourced through the NAB. Don’t bother asking other banks to match it as they can’t.

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