Australian Cities Ranked as "Impossibly Unaffordable" in Housing Market Report

Strategic Insights -

The latest Demographia International Housing Affordability report has labelled four Australian cities as "impossibly unaffordable" to buy a home, with Sydney ranking second behind Hong Kong as the most unaffordable housing market. The report found that more than 30 per cent of dwellings now cost $1 million or more, with Brisbane and Perth also ranked as "impossibly unaffordable." Separate research by Cotality found that the portion of dwellings valued at $1 million or more rose from 9.7 per cent in April 2015 to 34.4 per cent as of April 2025.

Key Takeaways:

  • Four Australian cities, including Sydney and Melbourne, ranked among the "top 10 least affordable" markets globally, with a median multiple of 9.3 in Brisbane and 8.3 in Perth.
  • The Demographia report found that the primary causes of housing affordability were "urban containment" measures such as growth boundaries, as well as restrictive land use policies.
  • The portion of dwellings valued at $1 million or more rose from 9.7 per cent in April 2015 to 34.4 per cent as of April 2025, a series high.
  • Sydney had 64.4 per cent of homes worth more than $1 million, with Melbourne having 30.9 per cent.
  • The report showed that Adelaide had lower average incomes than Melbourne, but average prices were pushing around or above Melbourne levels.
  • AMP chief economist Dr Shane Oliver stated that the Demographia report examines the price of housing relative to people's incomes and that regional areas like Newcastle and Ballarat were not included in the study.
  • Cotality head of residential research Australia Eliza Owen said that the figures in the report may be outdated, but endorsed Chapman University's findings pointing to the same issue, which is how unaffordable the Australian housing market is, particularly Sydney.
  • Owen highlighted the rise in million-dollar homes over time and that it would worsen inequality, locking out those who don't have a big pool of wealth to participate in the market.

Statistics:

  • 94.7 per cent of dwellings now cost $1 million or more (Cotality)
  • 34.4 per cent of dwellings now valued at $1 million or more (April 2025, Cotality)
  • 64.4 per cent of homes worth more than $1 million in Sydney (Cotality)
  • 40.2 per cent of homes in Brisbane worth more than $1 million (Cotality)
  • 9.7 per cent of dwellings valued at $1 million or more in April 2015 (Cotality)
  • 30.9 per cent of dwellings valued at $1 million or more in Melbourne (Cotality)
  • 8.3 rating for Perth on the Demographia scale (impossibly unaffordable)
  • 9.3 rating for Brisbane on the Demographia scale (impossibly unaffordable)

Sources:

  • Demographia International Housing Affordability report
  • Cotality report on Australian housing market
  • Interview with AMP chief economist Dr Shane Oliver
  • Interview with Cotality head of residential research Australia Eliza Owen