％Australia Government Bond 10Y
AU-10Y
▼ NegativeMonetaryrelevance
RBA rate hikes to curb inflation are tightening financial conditions, likely supporting higher bond yields.
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Housing affordability in Australia has fallen to a record low in fiscal year 2026, as high home prices and rising mortgage interest rates have significantly reduced household borrowing capacity. A report released by realestate.com.au on Saturday (September 5) stated that households with average income (approximately A$125,000 per year) can afford only 12% of homes listed for sale nationwide, the lowest level on record, down from the previous low of 14% in fiscal year 2008. Furthermore, low-income households (approximately A$76,000 per year) can afford only 2% of homes sold over the past year, leaving this group with almost no access to the housing market. The report noted that housing affordability declined after the Reserve Bank of Australia (RBA) raised interest rates three consecutive times in February, March, and May to curb inflation, with higher borrowing costs offsetting income growth and the slowdown in home prices in the latter part of the fiscal year, leading to a nationwide decline in affordability. Housing affordability fell in all Australian states in fiscal year 2026, with South Australia becoming the least affordable state in the country, surpassing New South Wales. Median-income households in South Australia can afford only 7% of homes for sale, while the median home price in Adelaide, the state capital, is as high as A$940,000.
RBA rate hikes to curb inflation are tightening financial conditions, likely supporting higher bond yields.