All housing markets in Melbourne are now officially out of reach for average wage earners.
Melbourne Housing Market Proves Unattainable for Average Wage Earners
In a worrying trend that shows no signs of slowing down, all housing markets in Melbourne have now officially become unaffordable for the average wage earner, according to recent reports.
Despite Melbourne experiencing clear signs of recovery from its market downturn, with five consecutive months of median property price increases, the dream of owning a home in the city has become increasingly elusive for many.
A report published by 9 News Australia highlighted the extent of the issue, stating that not a single housing market in Melbourne is within reach for the average wage earner. The report also pointed out that the income barrier to owning a family home in Melbourne now stands at a staggering $100,000.
This comes as property prices nationwide have seen a threefold increase in comparison to household income since June 2020, a trend exacerbated by the ongoing pandemic. Consequently, many Australians, particularly millennials, are delaying major life milestones, such as starting a family, due to the housing crisis.
Further compounding the issue, rental prices across the country have risen to historic highs, with Melbourne losing its title as one of the most affordable cities for renters, according to CoreLogic’s most recent Quarterly Rental Review.
The Organisation for Economic Co-operation and Development (OECD) has revealed that housing affordability in Australia has broadly declined since the early 1980s. Their price to income ratio index shows a 78% increase between 1980 and 2015, and the situation has only worsened in recent years.
These troubling statistics signal a need for urgent intervention to address the increasing unaffordability of housing in Melbourne and across Australia. While various solutions have been proposed, ranging from increasing supply to reforming tax incentives, there is a growing consensus that more needs to be done to ensure housing remains within reach for all Australians.
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