Introduction

Home ownership has long been associated with security and stability in Australia. However, the housing challenge is broader than rising property prices alone. Over the past two decades, house prices, rents and wages have moved at very different speeds. Housing outcomes have also changed across generations.

This story uses publicly available data from the OECD and the Australian Bureau of Statistics to explore whether home ownership is becoming increasingly difficult to achieve.

Hover over the lines, points and bars to explore the values in each visualisation.

1. Australian house prices have risen sharply since the mid-2000s

Real house prices have increased substantially since 2006. Although prices fell in some years, the long-term direction is clear: Australian housing has become more expensive in real terms. Source: OECD real house price index, 2015 = 100.

2. House prices have risen faster than wages

The affordability gap becomes clearer when house prices and average wages are compared from the same starting point. Average wages increased gradually, while real house prices rose much more sharply. Source: OECD real house price index and average annual wages, indexed to 2006 = 100.

3. Rental prices rose steadily before jumping again after 2022

Housing pressure is not limited to people trying to buy a home. Rental prices also increased over the long term and rose noticeably after 2022. People who remain outside home ownership may still face increasing housing costs through the rental market. Source: OECD rent price index, 2015 = 100.

4. Millennials are renting more than earlier generations

Housing outcomes have also changed across generations. Among Australians aged 25-39, Millennials are more likely to rent and less likely to own their home outright than earlier generations were at the same stage of life. Source: Australian Bureau of Statistics housing tenure data for people aged 25–39 years; selected tenure categories.

5. Housing costs have moved faster than wages

Bringing the three economic indicators together reveals a wider pattern. House prices and rents have moved much faster than average wages. The final chart shows why housing pressure affects both buyers and renters. Source: OECD house prices, rents and average annual wages, indexed to 2006 = 100.

Conclusion

Australia’s housing challenge cannot be reduced to a single measure. Real house prices have risen much faster than average wages, while rental prices have also increased. At the same time, Millennials aged 25-39 are more likely to rent than earlier generations were at the same stage of life.

Together, these patterns suggest that housing security is becoming increasingly difficult to achieve. For many younger Australians, the dream of owning a home may be moving further out of reach.

References