The national home affordability index improved by 2.3 per cent in the three months to the end of August, thanks largely to lower interest rates for mortgages. But it is questionable whether the current low interest rate environment can be sustained. Over the last year affordability overall has improved by 17 per cent.

The most affordable regions to live include Southland, with an index of 64.4 per cent of the national average, Manawatu/Wanganui and Otago. The least affordable places to live are Central Otago Lakes, with an index of 153.1 per cent of the national average, followed by Auckland, Wellington and Nelson/Marlborough.

The Home Affordability Report is prepared by Massey University's Department of Economics and Finance, and the full report is available at http://property-group.massey.ac.nz/fileadmin/research_outputs/AffordabilitySept09.pdf