You’ll need 300k a year to afford a home in Australia

Jarrod
By Jarrod
4 Min Read

Homeownership is well out of reach for most Australians as researchers reveal the average household needs to earn over $300k a year to afford a median home.

The damning report by Suburbtrends looked at more than 22,000 listings across the county in October and compared the median house prices in an area to median household income.

Areas in which house prices are up to three times median incomes are deemed ‘affordable’, as per international benchmarks.

Researchers found Australia’s median multiplier currently sits at 9.1 – meaning Aussies need to fork out over nine times their income to afford a home. 

The average household currently takes home less than $100k annually.

Sydney’s northern beaches were the most unaffordable area in the country, with homes demanding an income of $600,000. Melbourne’s inner-east required a salary of $428,000 and Brisbane’s south required $330,000.

The average Australian house price has risen more than 85 per cent since mid-2012, according to Australian Bureau of Statistics data.

Meanwhile, the average weekly wage for a full-time worker rose by just over 25 per cent between May 2012 and November 2021.

Suburbtrends Chief Analyst Kent Lardner said the housing market was in a state of “societal crisis” that was “eroding the middle class and widening inequality”.

“Our research paints a worrying scenario. In Australia, homeownership is increasingly becoming a domain for the affluent,” he said. 

“This isn’t merely about numbers, it’s about the erosion of the Australian dream. Homeownership is slipping out of reach for average earners.”

While Lardner acknowledged government shared-equity schemes like “Help to Buy” were making an impact, he warned homeowners that the home-buying policies could severely impact the maker down the road. 

“While shared-equity schemes may provide immediate relief, there’s a risk they could further inflate housing prices, driving the Median Multiple even higher,” said Lardner.

“Such strategies, though well-intentioned, might only serve as a short-term solution, potentially exacerbating the long-term affordability crisis.

“It’s crucial that we not only increase supply but also address the core problem of house prices relative to income.

“Strategies that worsen this metric could lead to greater pain in the long term. We need solutions that ensure sustainable affordability in the housing market.”

The report concluded with a call for a multi-faceted strategy to address housing affordability,, including re-evaluating urban planning and fostering income growth. 

Here’s how much you need to earn a year to buy a home in each state

New South Wales

Most expensive – Sydney Northern Beaches, $600,000 p.a

Least expensive – New England and North West, $148,000 p.a

Northern Territory

Most expensive – Darwin, $163,333 p.a

Least expensive – Northern Territory, Outback, $130,667 p.a

Queensland

Most expensive – Brisbane South, $330,000 p.a

Least expensive – Queensland, Outback, $90,000 p.a

Victoria

Most expensive – Melbourne Inner East, $428,833 p.a

Least expensive – North West, $129,833 p.a

Tasmania

Most expensive – Hobart, $225,167 p.a

Least expensive – West and North West, $146,667 p.a

South Australia

Most expensive – Adelaide, Central and Hills, $278,833 p.a

Least expensive – South Australia, Outback, $88,167 p.a

Western Australia

Most expensive – Perth, Inner, $210,000 p.a

Least expensive – Western Australia Outback (South), $111,667 p.a

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Jarrod
By Jarrod
Jarrod Brown combines his background in journalism, copywriting and digital marketing with a lifelong passion for storytelling. He has a strong passion for new and emerging consumer technology within the building sector. He lives on the Sunshine Coast - usually found glued to the deck of a surfboard.