When house price sustainability doesn’t mean affordability

In 2021, the Reserve Bank told us that house prices were unsustainably high and would likely fall by around 15%. That has proven to be the case and the market is now considered sustainable. Yet, house price-to-income ratios are still two to three times higher than they were 20 years ago, and most people with regular incomes still struggle to buy homes. In this episode, Bernard Hickey talks to Reserve Bank researcher Dr Andrew Coleman about his research measuring house price sustainability and why house prices remain unaffordable, despite hitting sustainable levels.

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