Australia's Housing Affordability Plunges to Record Lows

Australia's housing market has reached an all-time low in terms of affordability, according to a recent report from realestate.com.au.

The report notes that the Reserve Bank of Australia's interest rate hikes have led to higher borrowing costs, which have outweighed income growth and softening home prices, resulting in a decline in housing affordability nationwide.

A typical-income household earning $125,000 Australian dollars per year can only afford to buy 12% of homes sold across the country, down from 14% in the 2008 financial year. For low-income households earning $76,000 annually, the situation is even more dire, with affordability declining to just 2%.

The report also found that South Australia has become the least affordable state in the country, surpassing New South Wales, with a median household income able to afford only 7% of homes sold. The median home value in Adelaide, the capital city of South Australia, stands at $940,000 Australian dollars.