Sydney, Melbourne, Brisbane and Adelaide are currently among the 10 most affordable cities in the world.
Australia’s housing crisis has hit new highs, with one in three homes worth more than $1 million (US$643,000), with four major cities ranking as the most unruly in the world.
Two separate reports released on May 16th reveal the depth of the country’s housing crisis.
A new study from Cotality (formerly CoreLogic) shows that over 34% of Australia’s homes exceed $1 million.
Just 10 years ago, in April 2015, that figure was just 10%.
Cotality’s research director Eliza Owen said the $1 million mark is “increasingly standardized” especially after the median value for most capital cities exceeded that mark last year.
“But all of these types of research refers to the same thing. That’s just how unruly the Australian housing market is, especially in Sydney…it’s pretty tough,” she said.
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Even with $1 million, Owen noted that the quality and location of the available properties is degraded.
“If you can afford these assets, you either earn very high income, have sold another property well, or have wealth from your family. You need that big pool of wealth to join the market.
The aerial view shows vacant land separated for housing on January 11, 2024 in the western suburbs of Sydney. Jenny Evans/Getty Images
Four most affordable Australian cities in the world
Chapman University’s Affordable Price Survey of Demographic International Housing is ranked among the 15 most unruly Australian cities in the world.
Sydney ranked second globally behind Hong Kong alone. Melbourne, Adelaide and Brisbane also won the top 10.
Perth was shy and missed slightly at the “incredibly unruly” threshold of 9.0 used in the study, with a median multiple of 8.3.
This report measures affordability by comparing median home prices with median household income. Rats below 3.0 are considered affordable. None of the 95 cities surveyed met that standard.
“Sydney has the first, second or third affordable housing in the major market over the 16 years of the last 17 years,” the report states. “It is worth noting that Australian markets, including Melbourne and Brisbane, are less affordable than cities like New York, London and Chicago.”
Aerial view of the completed house on a recently developed property in Clyde North, a federal seat in Holt, Melbourne, Australia, on March 26, 2025. Asanka Ratnayake/Getty Images
As prices rise, wages stagnate
Owen attributed the crisis to run wild and stagnant wages. This is especially followed the housing boom during the pandemic era, where price inflation that transcends capital cities across the region’s centre.
“To get into the market, we need that huge pool of wealth and lock those who don’t,” Owen warned.
The lack of affordable housing options also has strained social services. Waiting lists are expanding, but stocks in public housing are steadily declining.
Many Australians are now turned over into overcrowded housing and, in extreme cases, homelessness.
Containment under planning law and containment
The demographic report points to limiting urban planning policies (particularly “city containment” rules) as the root cause of the crisis.
These rules limit land supply for development, increase prices and price the average household.
Over the past 50 years, these policies have made it difficult for the middle class to own a home.
“Given the advantages of housing costs for households, this also means that these stronger policies are linked to an increase in overall poverty,” he said.
Experts add that there is a fundamental discrepancy between supply and demand. Australia has not built enough homes to keep up with the fast-growing population. The resulting rarity pushes prices up high across the board, from rental to homeownership.
New Zealand offers a blueprint for reform
The report highlights New Zealand’s “go for housing growth” policy as a potential model.
The reform program opens land for greenfield development and funds infrastructure using “specially intended vehicles.” These vehicles allow developers or prospective residents to cover costs over time, reducing the financial burden of government advance payments.
A harsh outlook without urgent reforms
Without serious reforms, the report warns, but home prices are out of reach for millions of people. Major cities risk losing their residents to more affordable regions and countries, weakening their economic pull, and further destroying the residential landscape.
Some states, including Victoria and New South Wales, are beginning to encourage high density development near transport hubs. However, it remains to be seen whether these plans will be implemented quickly enough to change the trajectory.
