Sydney continues to rank as one of the world’s most expensive housing markets, second only to Hong Kong, according to the Demographia International Housing Affordability Report. The city’s median house price is now 13.8 times the median household income, which the report labels “impossibly unaffordable.”
Once viewed as Australia’s “affordable capital,” Adelaide has overtaken Melbourne to become the second least affordable city, with its median multiple climbing to 10.9 – ahead of Melbourne (9.7) and Brisbane (9.3).
“Adelaide’s affordability advantage has disappeared,” said Ray White chief economist Nerida Conisbee (pictured), noting that housing costs are rising much faster than local incomes. “Prices have risen by 9.1%, outpacing both Melbourne and Sydney.”
Despite strong price gains in recent years, Perth remains the most affordable of Australia’s five major cities, with a median multiple of 8.3 times income. Higher wages in Western Australia cushion the impact of rising prices, though affordability still sits far above Demographia’s “affordable” benchmark of 3.0.
Australia’s national median multiple of 9.7 is among the worst in the developed world—less affordable than Canada (5.4), the UK (5.6), or the US (4.8). The report found that, by this measure, Australia’s housing ranked among the least affordable of all high-income nations.
Adding to the pressure, new data from Cotality shows Australia’s residential property market has reached a record $11.8 trillion in total value, rising $678 billion over the past year. National dwelling values lifted 2.2% over the September quarter, marking the strongest quarterly growth since May 2024.
With house prices already up 8.9% year-on-year and momentum building, affordability is expected to worsen through year-end. Further Reserve Bank rate cuts and first-home buyer incentives could intensify demand, while sluggish new housing supply keeps pressure on prices.
The national housing boom—driven by undersupply, resilient demand, and high investor activity – suggests affordability will remain a central challenge heading into 2026.
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