A 21-year-old paralegal in Sydney says she is putting her paychecks into an account she cannot access until she turns 25 as she tries to save a deposit for her first home, a personal strategy that reflects growing difficulty for younger Australians to break into the property market.
The woman, who spoke to property payment company Coposit, described Sydney as "almost impossible" for people her age to buy into and urged other young Australians to use a set-and-forget savings account. "I think, especially right now, I would put money into something or somewhere where you can't actually touch it," she said. "You have no choice but to save."
Her account of trying to accumulate a deposit comes as official and industry data show housing has become markedly less affordable in recent decades. The Australian Property Institute's Valuation Report released in May found Sydney's median house price is now about 13 times the average salary, a figure that has climbed sharply from 4.2 times the average worker's salary around 50 years ago. The report places the city well above other capitals: Melbourne's median house price was about 8.4 times the average salary and Canberra's about 9.0, while Darwin remained the most affordable among capitals at approximately 5.8 times the average income.
Data from the Australian Bureau of Statistics put the average Australian salary last year at just under A$103,000, while industry figures estimate a median Sydney home at nearly A$1.34 million. Analysts point to sustained house-price rises, high inflation and a shortage of housing supply as key drivers of the widening gap between incomes and property values.
Between 2005 and 2024, Sydney house prices rose about 171 percent, and other capitals recorded similar double-digit percentage increases: Melbourne rose about 169 percent and Adelaide about 175 percent during the same period. In Queensland's capital, Brisbane, the ratio of median house price to average salary climbed from roughly 2.9 times in 1975 to about 8.3 times today.
Generational shifts in homeownership rates further illustrate the challenge facing younger Australians. Housing industry data cited by real estate agencies show that when Baby Boomers were aged 25 to 39 in 1991, roughly 70 percent owned their homes. That rate fell to about 65 percent for Generation X in 2006 and to roughly 55 percent for millennials in the same age bracket, with around 40 percent renting.
The change has encouraged alternate approaches to property investment and tenure. Industry surveys such as one by Westpac report that about 82 percent of first-home buyers would consider purchasing in areas they had not previously thought of, and roughly 54 percent were open to "rentvesting"—buying property to invest while continuing to rent in a preferred location.
Economists and property analysts say the combination of relative wage stagnation, rapid house-price growth and limited new housing stock has made conventional home-ownership pathways harder for younger cohorts. Rental pressures and higher mortgage-servicing costs have also increased the appeal of nontraditional strategies such as buying in lower-cost areas or holding investment properties while renting.
Policy makers and industry groups have highlighted supply constraints and the need for measures to boost housing availability as central to improving affordability. The trends illustrated by the paralegal's savings strategy and the AP Institute report underscore the extent to which housing costs have outpaced incomes for many younger Australians, particularly in Sydney, and the resulting shift in how they approach the property market.