The average house price in Australia has broken the $1 million mark for the first time. This milestone comes as the country struggles with a severe housing affordability crisis.
According to the Australian Bureau of Statistics, the median house price reached $1,002,500 in the March quarter, a 0.7% increase from the previous quarter. Australia is now home to some of the most expensive cities in the world, making buying or renting a house increasingly difficult for many Australians.
Experts point to a combination of factors contributing to this crisis, including a limited supply of homes, a growing population, tax benefits for property investors, and inadequate investment in public housing. New South Wales, the most populous state, has the highest median house price at $1.2 million, followed by Queensland at $945,000.
The Australian Bureau of Statistics notes that Western Australia, South Australia, and Queensland were the main drivers of the price increase in the latest quarter. Although house prices rose in every region, the annual growth rate is starting to slow down. The data covers over 11.3 million homes across Australia, including detached houses, townhouses, and apartments.
Michael Fotheringham, director of the Australian Housing and Urban Research Institute, is not surprised by the milestone, citing a long-term national trend of rapidly rising house prices outpacing wage growth. This has put the housing system under immense pressure, affecting not only low-income households but also middle-income ones. The rental market is also facing a shortage, and public housing stock is insufficient to meet demand.
Fotheringham adds that Canada is facing similar challenges, while the UK has a more developed social housing sector. Both the UK and Australia have set ambitious housing targets, with Australia aiming to build 1.2 million homes and the UK aiming for 1.5 million within the next five years.
Australian Prime Minister Anthony Albanese, who recently won his second term, considers housing a key priority. He has announced plans to simplify development regulations, which have been criticized for limiting the construction of new homes.
Source: BBC