Queenstown houses are slightly more affordable, thanks to a slide in prices in December, according to the Roost Home Loan Affordability report.
But it is still tough for typical buyers to get into the market, the report says.
Home loan affordability improved nationally in December because of falling house prices, but remained very difficult in Auckland Central and Auckland's North Shore, which were now more expensive than Queenstown for the first time.
The report showed the median Queenstown house price in December was $429,000, down 10.8% on the December 2009 price of $481,000.
It now took 73% of one median income to pay the mortgage on a median-priced Queenstown house bought in December, down from November's 81.9%. A typical buyer is assumed to be in the 30-34 age group.
The index was 91.2% a year ago. The affordability index reached its highest point of 154% in December 2005.
Dwelling sales in December were 40, unchanged from November and lower than the 42 sales 12 months ago.
Essentially, the median income for the typical buyer is not high enough to buy a median-priced house, even with a 20% deposit. However, buyers might find the lower-quartile priced houses are affordable. A couple or family with more than one income might find the median house price is affordable.
Based on current income and house prices, it would take an individual 11 years to save the 20% deposit now required by most banks.
The median weekly take-home pay for a typical buyer was $742.14 in December, up 6% from the $700.06 in December 2009.
Roost says weekly disposable income in Queenstown was $200.25 in December, which is $138.61 higher than the $61.64 in December 2009.
This measure shows the typical buyers' income is too low by itself to afford the mortgage payments on the median-priced home.
Based on the standard household profile, it now takes 88.3% of the median household take-home pay to service a mortgage of a Queenstown home purchased in December.
Median-priced housing is still not affordable for families in Queenstown, even when both adults work.
• CENTRAL OTAGO
It now takes 68.1% of one median income to pay the mortgage of a median house bought in Central Otago Lakes in December, down from November's 71.8%.
The index was 82% a year ago. The index reached its highest point of 137.6% in October 2007.
The median house price was $400,000 in December, down from $421,000 in November. The median house price was $432,500 in December 2009, putting annual growth at -7.5%.
Dwelling sales in December were 67, down from 75 in November and lower than the 95 sales of 12 months ago.
The median take-home pay for a typical buyer in the district was $742.14 in December, up 6% from the $700.06 12 months earlier.
The median income for the typical buyer is not high enough to buy a median-priced house, even with a 20% deposit.
Weekly disposal income in Central Otago Lakes was $236.88 in December, $110.87 higher than the $126.01 of 12 months ago.
It now takes 45% of the median household take-home pay to service a mortgage of a median-priced house bought in December.
Median-priced housing is still not affordable for families in Central Otago Lakes, even when both adults work.
• DUNEDIN
It takes 45.6% of one median income to pay the mortgage of a median-priced Dunedin house bought in December, up from November's 43.3%. The index was 49.5% a year ago. The affordability index reached its highest point of 71.8% in March 2008.
The median income for the typical buyer is not high enough to buy a median-priced house.
The median house price was $249,500 in December, up from $236,000 last month. The median price was $243,000 in December 2009, putting annual growth at 2.7%.
Dwelling sales in December were 179, down from 204 in November and lower than the 185 a year ago.
The median after-tax pay in Dunedin for a typical buyer was $690.57 in December, up 6% from a year earlier.
It now takes 29.4% of the median household take-home pay to service a mortgage of a median home purchased in Dunedin last month. The housing is affordable to families in Dunedin when both adults work.
• OTAGO
It now takes 40% of one median income to pay the mortgage on a median-priced house bought in Otago last month, up from November's 39.2%.
The index was 43.6% a year ago. The affordability index reached its highest point of 63.8% in December 2007.
Roost says the median income for the typical buyer is not high enough to buy a median-priced house, even with a 20% deposit.
The median house price was $235,000 in December, up from $230,000 in November. The median price was $230,000 a year ago, putting annual growth at 2.2%.
Dwelling sales in December were 231, down from 260 in November but the same as a year ago.
The median take-home pay for a typical buyer in Otago was $742.14 in December, up 6% from a year ago.
Weekly disposable income was $445.30 in December, $50.52 higher than the $394.78 in December last year.
It now takes 26.4% of the median household take-home pay to service a mortgage. Median-priced housing is affordable to families in Otago when both adults work.
BASIC FACTS
• An index rating of above 40% is considered "unaffordable".
• The standard buyer index is calculated assuming that the house buyer already has the 20% deposit required by most banks.
• Interest rates have fallen slightly since last month and are lower than one year ago.
• The average bank interest rate for a two-year fixed rate mortgage was 6.65% for December, down from 7.20% 12 months ago.
• A standard buyer household is one adult male working full-time, one adult female working 50% and one child aged 5.
• Income tax cuts came into effect on October 1 and improved home loan affordability by more than 2%.
