Here at Barry Plant Frankston, we are well aware of the affordability concerns that home buyers and their families are experiencing, particularly those entering the market for the first time. After all, we have assisted countless first-time buyers to find and secure their first home in the past few months alone.

It is worth pointing out, however, that some people have mistakenly assumed that the strong rate of growth in property prices is something new. The fact is that the growth in housing values has been exceeding the growth in average wages for many years now, so we pulled out some market statistics to clarify the matter.

Data from Corelogic shows that over the past two decades, (since October 2001), the median price of an Australian house has increased by 193 percent. Yes, this number has trended upward recently with prices nationally going up by 22 per cent over the past 13 months, but that rate of growth over 20 years is certainly no “flash in the pan”. By comparison, the average wage in Australia has risen by 81.7 percent over the same period, but as we all know, Aussie wage earners have continued to purchase property in increasing numbers over that period.

At a more localised level, the data for Victoria over the past 20 years shows an increase in property prices of just over 209 percent, compared with an increase in wages of 82.3 per cent.

You might also be surprised to know that while so much of the media focus has centred on housing prices in New South Wales and Victoria, the state with the largest rate of property price growth over the past two decades is actually Tasmania. Down south, prices have risen almost 300 per cent while wages rose by around 84 percent over the same 20 year period.

When you look at the strength of price rises over this extended period of time, it seems highly unlikely that we will see any consistent downward movements over any extended period. A slight pause when interest rates eventually rise? Probably. But if you’re holding back from buying because you want to wait for a big drop, you are probably costing yourself a great deal of money.

With these numbers in mind, if you’d like to chat with one of our team about the best way to approach the current market conditions, whether you’re buying or selling, don’t hesitate to give us a call this week at Barry Plant Frankston on 9781 3100.

Best wishes,

Barry Plant Real Estate

Frankston & Cranbourne