The REIA has released its Housing Affordability Report for the December 2025 quarter, confirming a decline in housing affordability nationally following several quarters of improvement earlier in the year. The proportion of family income required to meet average home loan repayments increased to 49.2 per cent, representing a deterioration of 2.2 percentage points over the quarter, though affordability remains 0.7 percentage points better than the same period last year.
Rental affordability remains relatively stable, with the proportion of income required to meet median rent increasing slightly to 24.3 per cent nationally. While rental affordability declined marginally over the quarter, it remains 0.3 percentage points better than a year ago.
Key takeaways:
Housing affordability declined in every state and territory over the quarter, with the largest deterioration recorded in Western Australia.
First-home buyer activity increased significantly, with 34,013 new entrants to the market nationally, up 16.3 per cent over the quarter.
The national average loan size rose to $736,258, increasing 6.1 per cent over the quarter and 10.5 per cent over the year.
The average loan size for first-home buyers increased to $607,624, up 8.5 per cent over the quarter and 11.8 per cent over the year.
The national median house price increased to $1,184,373, rising 5.3 per cent over the quarter and 11.1 per cent year-on-year.
In Victoria, housing affordability declined slightly over the quarter, with mortgage repayments now accounting for 44.8 per cent of median family income, up from 43.4 per cent in the September 2025 quarter. However, affordability remains higher than a year earlier.
Rental affordability in Victoria improved over both the quarter and the year, with 20.4 per cent of family income required to meet median rents, down from 20.7 per cent in the previous quarter and 1.1 per cent over the year.
Victoria also maintained its position as the nation’s leading state for first-home buyers, with 11,082 new entrants during the December quarter, accounting for 32.6 per cent of all first-home buyers nationally. First-home buyers represented almost 40 per cent of the state’s owner-occupier market.