Housing affordability to remain a challenge for homebuyers in APAC | Real Estate Asia
, APAC

Housing affordability to remain a challenge for homebuyers in APAC

This is despite a slight improvement expected across some markets.

Although Asia-Pacific's housing affordability will generally improve slightly, in some economies borrowers will still struggle to repay mortgages amid elevated interest rates and homebuyer sentiment will remain subdued, said Moody's Investors Service in a new report.

"Housing affordability will improve slightly in China (A1 stable), Hong Kong SAR, China (Aa3 stable), Australia (Aaa stable), Indonesia (Baa2 stable) and Japan (A1 stable) this year, as GDP per capita growth outpaces home price changes. Despite improving, affordability will remain a stretch for homebuyers in some parts of Asia-Pacific or fall short of inspiring a major pick-up in property market sentiment," says Cedric Lai, a Moody's Vice President and Senior Analyst.

Homebuyer sentiment will remain subdued in some Asia-Pacific economies, constraining the revenue and profitability of property developers Moody's rates in those areas over the next to 12 months. In China, developers' home sales have weakened from a low level in recent months after recovering in the first quarter of 2023, while those in Hong Kong will have to adopt conservative pricing to maintain sales amid subdued homebuyer sentiment. On the other hand, in Australia, developers will benefit from strong housing demand over the medium term.

Better housing affordability will have uneven credit implications for Asia-Pacific's mortgage sector. In China, improving housing affordability and recent interest rate cuts will ease mortgage repayment risks for home loan borrowers, benefiting the residential mortgage-backed securities (RMBS) sector. In Australia, housing affordability will remain a risk for RMBS and covered bonds. And in Japan, the credit quality of mortgages backing RMBS will remain strong.

 

Join Real Estate Asia community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

Exclusives

How Metland Indonesia deals with weaker residential purchasing power
The real estate firm continues to expand with residences that are attractive to consumers because of pricing, the ‘growing house’ concept, and sustainable features.

Event News

Event News

Real Estate Asia Awards 2023 Winner: Henderson Land Development Company Limited
Henderson Land Development Company Limited wins big at the Real Estate Asia Awards 2023 taking home 3 notable accolades, the Developer of the Year, Mixed-Use Development of the Year, and Residential Development of the Year awards for Hong Kong.
Real Estate Asia Awards 2023 Winner: Henderson Land Development Company Limited
Henderson Land Development Company Limited wins big at the Real Estate Asia Awards 2023 taking home 3 notable accolades, the Developer of the Year, Mixed-Use Development of the Year, and Residential Development of the Year awards for Hong Kong.