The Reserve Bank's lowering of its interest rate forecasts has improved the outlook for home loan affordability through late 2011 and into 2012 as house prices remain stable in most cities and incomes edge higher.
The Roost Home Loan Affordability report for August shows a slight deterioration in August from July because the national median house price nudged higher, but affordability is near its best levels since early 2004 because of record low interest rates.
Massey University's home affordability report, also released today, shows cautious buyers and low rates of new construction have left the housing market subdued.
Massey's report says home affordability improved slightly during the last quarter, but was slowing.
Professor Bob Hargreaves from the university's school of economics and finance said a growth and wages and low mortgage interest rates had offset a slight increase in the media house price.