Home affordability continued to decline nationwide over the September quarter, as the AMP home affordability index posted its fifth consecutive fall. However, with interest rates peaking and softer house prices, the outlook is rosier for later this year.
The latest AMP Banking Home Affordability Report shows a drop in affordability of 5.6 per cent over the September quarter. The fall held across all 11 regions measured, even though median dwelling prices fell in eight of them.
The September index also reflected a 12 monthly decline of 32.5 per cent, the steepest decline for the past five years.
AMP Bank's affordability report is prepared quarterly for the bank by Massey University and compares average weekly earnings with median dwelling prices and mortgage rates to come up with an affordability index.
What happened in the regions:
(the lower the index figure, the higher the affordability)
| Region | Index May 2000 | Index Aug 2000 | Decline | | ------------------- | ------------------ | ------------------ | ----------- | | Northland | 17.52 | 19.44 | 29.0% | | Auckland | 27.39 | 28.93 | 33.9% | | Waikato/BOP | 20.24 | 21.95 | 34.2% | | Hawke's Bay | 15.97 | 18.51 | 47.9% | | Manawatu/Wanganui | 13.46 | 13.65 | 23.4% | | Taranaki | 11.53 | 12.24 | 32.2% | | Wellington | 20.13 | 22.01 | 47.8% | | Nelson | 17.41 | 17.50 | 24.0% | | Canterbury/Westland | 18.84 | 19.52 | 31.1% | | Otago | 13.16 | 14.01 | 24.4% | | Southland | 9.18 | 9.38 | 16.4% | | New Zealand | 20.79 | 21.94 | 32.5% |
