Working Australians are being squeezed out of the rental market as housing costs rise much faster than wages, leaving younger people in particular paying record shares of their income just to keep a roof over their heads. For many, the only realistic path into ownership now runs through parental help or inheritance, entrenching a divide between those with access to “boomer money” and those without.[1][2][3][4][5]
Over the past five years, median advertised rents across Australia have jumped by almost 44 per cent, adding roughly 200 dollars a week to typical housing costs and pushing median weekly rent above 700 dollars for the first time. New analysis from the Australian Bureau of Statistics shows rent inflation running at around 4 per cent annually in late 2025—well above the Reserve Bank’s old 2–3 per cent comfort zone and on top of steep increases since the pandemic. At the same time, the Wage Price Index has been growing at about 3.4 per cent a year, meaning rents have been rising faster than pay packets and steadily eating into the budgets of people who are already in full‑time work.[6][7][8][3][4][1]
For younger Australians, the numbers on getting out of renting and into ownership are even starker. A recent national housing affordability report found that in most capital cities it now takes more than a decade of disciplined saving for a typical household to accumulate a standard 20 per cent deposit, with Sydney buyers facing closer to 15–17 years at current prices and incomes. Other research suggests only about 14 per cent of median‑income households can afford to buy a home at today’s prices, a figure that drops to around 10 per cent in Sydney, while the median dwelling value nationwide is now well above 800,000 dollars. In practice, this means many otherwise “successful” young workers—earning decent incomes and doing what previous generations were told to do—still cannot save a deposit while covering market rents and living costs.[2][5]
The result is a structural shift in who can treat housing as a realistic long‑term plan. Households with access to intergenerational transfers, early inheritances or fully paid‑off parental homes can still bridge the deposit gap through gifts, guarantees or equity releases. Those without such backing are left renting for longer, absorbing rent rises that outpace wages, and often postponing family formation or other life decisions as more of their income disappears into housing. For a growing share of working Australians, the issue is not a lack of effort or attachment to the labour market, but a simple mismatch between what essential shelter costs and what even steady employment can reliably provide.[3][4][5][1][2]
Sources
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ABS – Latest insights into the rental market:
https://www.abs.gov.au/articles/latest-insights-rental-market[6] -
Trading Economics – Australia rent inflation data:
https://tradingeconomics.com/australia/rent-inflation[7] -
ABS – Private rent inflation: capital cities vs regions:
https://www.abs.gov.au/articles/private-rent-inflation-capital-cities-vs-regions[8] -
Cotality / ABC – “Rental prices have risen almost 44 per cent in five years, Cotality review finds”:
https://www.abc.net.au/news/2025-10-08/rental-prices-surge-almost-44-per-cent-review-finds/105865000[3] -
Cotality Housing Affordability Report coverage – “extraordinary” unaffordability, deposit years:
https://www.abc.net.au/news/2025-11-25/housing-unaffordability-reaches-record-levels-in-australia/106044078[2] -
Trading Economics – Australia wage growth:
https://tradingeconomics.com/australia/wage-growth[1] -
ABS – Wage Price Index, Australia:
https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/wage-price-index-australia/latest-release[4] -
Gen Z housing and affordability commentary:
https://duotax.com.au/insights/gen-z-property-ownership/[5]
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always consult with a qualified financial advisor before making investment decisions.