Great Australian dream a nightmare as average Australian salary priced out of housing market

The great Aussie dream to own a house with a backyard for the kids to run around is turning into a nightmare, with exclusive analysis revealing the average salary needed to buy a home in four major capital cities.

It was once the great Australian dream to own a house with a backyard for the kids to run around in – but that dream is fast turning into a living nightmare with exclusive analysis revealing the average Aussie salary can no longer afford to buy a house in metropolitan Sydney.

Canstar analysis, conducted exclusively for this masthead, reveals an Australian on the national average salary, in any age bracket, would not be approved for a home loan to purchase a house in Sydney, Melbourne, Brisbane or Adelaide as median property prices reach massive highs.

The report revealed a single Sydneysider would need a before-tax income of $234,960 to afford the loan of the average Sydney home, currently valued at $1.470 million.

It can also be revealed that a Sydney couple of any age with a dual national average salary of $103,000 would not be approved for a loan to buy a house in metropolitan Sydney at the current state average.

The Canstar analysis reveals that two before-tax incomes of $113,340 or more – and a deposit of close to $300,000 – would be needed to be approved for the average house in the Harbour City.

Meanwhile in Melbourne, a salary of $141,580 would be needed to afford the median house price of $917,000. It is a similar story in Brisbane and Adelaide, where an individual salary of $149,346 and $134,952, would be needed to purchase the average home.

Canstar Data Insights director Sally Tindall. Picture: supplied. NSW real estate

Canstar data insights director Sally Tindall told The Sunday Telegraph “soaring property prices, combined with higher rates, rents and everyday living expenses have put buying a home firmly out of reach for many Australians hoping to buy a home they can call their own”.

“Someone on a middle-of-the-road income, without a partner to buy with, or a family member who can give them a leg up, is likely to find it extremely tough, in some cases, near impossible, to buy a median priced apartment, let alone a house, in key property hotspots across the country,” she said.

The average Australian salary can no longer get approved for the average Australian home.

“If that’s you, 2025 could be the year you switch to plan B.

“This could mean looking for a smaller apartment at an entry point, a place further away from friends and family, a fixer upper that doesn’t have a swarm of interested buyers – even buying an investment property as your first foot on the property ladder.”

It can be revealed an increasing number of ambitious young Aussies are turning their backs on the property market for investment opportunities and small business start-ups in a bid to get ahead.

Social Researcher Mark McCrindle. Picture: Glenn Campbell

New research from McCrindle has revealed a growing number of successful young people are “scrapping the home buying target as a key measure of life success and focusing on financial independence”.

Social Demographer Mark McCrindle confirmed the idolised ‘Australian Dream’ was now a nightmare for single-income households as cost-of-living pressures result in a “paycheck-to-paycheck mentality”.

“This research shows ambitious young Australians are being forced to climb the property ladder later in life amid skyrocketing house prices, interest rates, and inflation, meaning they are forced to buy their first home in their late thirties and early forties,” Mr McCrindle said.

Get a job, they said. Get a house, they said. Live the dream, they said. Maria and husband Adrian in their Gregory Hills home in Sydneys West. Picture's Darren Leigh Roberts

“A New Australian dream is fast developing, and is focused on a debt-free lifestyle. “They are studying later, at a cost, they are using flailing deposits once set aside for homeownership on crypto, NFTs, and other short-term investment opportunities.” But Mr McCrindle said the delay in purchasing a home meant countless young people were also delaying other major life decisions.

“They are living at home longer, marrying later, studying at higher costs, and having children even later than ever before,” he said. “They are being forced to either rely on the bank of Mum and Dad or wait for an inheritance.

Collyer Property Investments boss Aidan Collyer

Collyer Property Investments boss Aidan Collyer said a growing number of first home buyers were “ageing out of their 30s and into their 40s”.

“I’m speaking to so many people who are worried about ever owning a home at all,” he said. “They have either moved interstate, are considering moving, or have taken up the ‘rentvesting’ trend and are going to keep renting or living with mum and dad and are buying one or multiple investment properties to at least get into the market.

“Clients are sadly also relying on the bank of mum and dad or have resolved themselves to the fact that without their inheritance, they’ve no option of buying.”

Ally Kirk is a 32-year-old, successful teacher struggling to get into the housing market. Picture: Tim Hunter.

Western Sydney teacher Ally Kirk, 32, said she was convinced “the Great Australian Dream is more out of reach, and unattainable than ever before”.

“The cost of everyday living means that saving for a house deposit has become a ridiculous task, despite having a six figure salary,” she said. “Homeownership in your 30s is no longer palatable – the rest of your life becomes unlikeable if you are desperately saving every dollar you have for a house.”

“Home ownership is something I still aspire to, but this wont become a reality until I am about 40 – I have been looking for property and it was a miserable endeavour so I stopped.”

Catie Potinger. 23, a PhD Student at UTS said the Aussie dream is dead. Picture: Ted Lamb

Manning Chia, 21, is resigned to the fact he will never own a home. Picture: Ted Lamb

Ms Kirk said first home buyers need two six-figure incomes to buy into this market anywhere in metropolitan Sydney, “but even then the desired lifestyle and affordability are a trade-off”.

“I am looking at the possibility of renting at a massive premium for a shoebox – a closet under the stairs fit for Harry Potter”.

PhD student, Catie Pottinger, 23

“The Australian Dream in terms of home ownership is dead. I have been looking to buy in the Ashfield area and other inner west locations.

“The New Australian Dream is now just renting comfortably in shared houses with people whose company you enjoy.

“I certainly have friends who are 40 and they’re still in share houses.”

Videographer, Manning Chia, 21

Manning’s resigned to the fact that he will never own property on the east coast of Australia.

He said the New Australian Dream should be pivoted to thriving elsewhere across the globe.

Alexia Damokas, 24, the teacher says home ownership is not realistic for her. Picture: Ted Lamb

Pippa Casey, 25, who works in marketing, does not expect to buy until she is 40. Picture:

Teacher, Alexia Damokas, 21

She said she knew that “doing the things that my parents did when they were my age was just not going to happen.”

“Based on how much I earn at my job versus, you know, how much they earn with inflation and cost of living, I just don’t think it’s very realistic anymore.

“I’ve come to the realisation and understand the fact that I’m most likely never going to own a home, most of my friends won’t ever so I don’t feel alone in the matter, at least.”

Marketer, Pippa Casey, 25

She doesn’t expect to buy a home until she is 40.

“There’s pros and cons, obviously, to the rental market, but I suppose once you’re in, and you can afford to have that stability, then maybe the dream changes to travel or other experiences rather than saving, and saving to buy a house.”

Originally published as Great Australian dream a nightmare as average Australian salary priced out of housing market