As Australia looks towards their all but inevitable 2022 election, the housing crisis dominates the political discussion. The current median dwelling price in Sydney is almost A$1.2 million (£570,294, $742,026), catastrophic for would-be homebuyers. FAMILY PROMISE The rental market has experienced a jaw-dropping 36.1% jump in rents since the start of COVID-19. This increase amounts to an additional A$171 per week in living costs, further tipping the scales of the financial burden.
Government policies over decades have commodified property ownership and made it largely inaccessible for many Australians. Foreign purchases of homes, some experts say, have added to the popular housing strain but there’s no consensus on how distorting the effect is. Brendan Coates of the Australian Grattan Institute makes the case that this problem is “tiny” and not a major driver of housing markets overall.
Our 2024 State of the Housing System report makes clear just how shocking that is. Now, on average, a first-home buyer would spend almost a decade saving the required 20% deposit to purchase an average home. Such a long saving period underscores the increasing gap between wages and housing expenses. In Australia’s capital cities, house prices have skyrocketed to an average of slightly more than A$900,000. In the five years from 2016 to 2021, overall house prices across Australia jumped by 39.1%. All of this is happening at the same time that wages haven’t increased to match these skyrocketing expenses.
Political parties are addressing this crisis with bold, imaginative plans. The Coalition’s housing supply pledge is to free up half a million additional homes. At the same time, the federal Labor Party is promising to bring forward 1.2 million new homes by 2029 under their A$33 billion national housing investment plan. This plan contains measures to assist first time homebuyers purchase homes with lower deposits through shared-equity loans.
Despite these promises, the Urban Development Institute of Australia’s 2025 State of the Land report suggests that the federal government will fall short of its target of 1.2 million new homes by nearly 400,000 units. This glaring gap begs the question of whether political promises can be fulfilled in the face of a worsening crisis.
Brendan Coates sounded a note of skepticism on the prospect of immigration policy reducing housing demand. He criticized the Coalition’s new plan to cut immigration, arguing that would only achieve a small reduction in housing costs in the short term. He cautioned that this would lead to a less prosperous Australia in the decades to come. “A combination of both parties’ platforms would be better than what we’re seeing from either side individually,” he stated.
Our very own Michael Fotheringham joined the debate on the great immigration is to blame for housing crunch discussion. He remarked, “The impact [of migrants] on the housing market is not as profound as some commentators have suggested.”
Housing affordability should be one of the key issues facing many Australians right now, with a growing chorus demanding urgent reforms and policy changes. Mr. Fotheringham elaborated on this sentiment, saying, “We’ve been sleepwalking into this as a nation for quite some time.”
With the election looming, voters are asking for more housing choices, not less. Skyrocketing prices and frozen wages mean more Australians can no longer afford to live. Now they’re wondering if political pledges can actually make it easier for them to find affordable places to live.