Key takeaways
Recent reports paint a grim picture for teachers, nurses, and other essential workers, who are finding it increasingly beyond their financial reach to own a home.
The data from this report reveals that the ten most common jobs in Australia do not earn enough to afford the average Australian home. Teachers and nurses would need to save for over a decade to afford a deposit.
This issue is widespread, affecting cities and regional areas alike, and could lead to staffing shortages in critical sectors like healthcare and education, as well as increased social tension and a greater sense of disillusionment among younger generations.
There is a solution to the problem of housing affordability, but it is going to require coordinated action from all levels of government, as well as the private sector.
The federal government's initiative to build 1.2 million new dwellings in the next five years won't address the problem of affordable housing because the dwellings will be in the inner and middle ring suburbs of our capital cities.
The great Australian dream of owning a home is slipping further out of reach for many, particularly those in the most common occupations.
Recent reports paint a grim picture for teachers, nurses, and other essential workers, who now find themselves grappling with a housing market that's increasingly beyond their financial reach.
If you've been paying attention to the state of housing affordability in Australia, this won't come as a shock, but it certainly underscores the growing divide between wages and property prices.
The harsh reality of housing affordability
A recent report from Anglicare Australia, highlighted by The Guardian, sheds light on a disturbing trend: even those in the most common jobs in Australia are struggling to save enough for a home deposit without experiencing significant housing stress.
Housing stress, as defined by the report, occurs when a household spends more than 30% of its income on housing costs. For many Australians, this isn't just a temporary situation—it's become a way of life.
The report outlines that workers in jobs like teaching, nursing, and retail—positions that are essential to the functioning of our society—are finding it nearly impossible to save for a deposit while keeping up with the cost of living.
Source: The Guardian
The average home price is simply out of reach for many, even in areas that were once considered affordable.
The numbers don’t lie
The data from this report reveals that the ten most common jobs in Australia, which include sales assistants, aged care workers, and child care workers, do not earn enough to afford the average Australian home.
In fact, the gap between wages and property prices has grown so large that it would take a nurse more than a decade to save for a deposit—assuming they could save a significant portion of their income, which is increasingly unlikely given the rising costs of living.
Similarly, teachers and nurses, showing that these professionals would need to save for over a decade just to afford a deposit on a median-priced home.
This isn't just a Sydney or Melbourne problem—this issue is widespread, affecting cities and regional areas alike.
What does this mean for the future?
The implications of these findings are profound.
- Also read:Everything you need to know about the state of Australia’s property markets in 20 charts – November 2024
- Also read:This week’s Australian Property Market Update – Latest Data, State by State November 19th 2024
- Also read:Melbourne property market forecast for 2025
- Also read:Sydney property market forecast for 2025
- Also read:Brisbane’s property market forecast for 2025
If essential workers can't afford to live in the communities they serve, what does that mean for the future of those communities?
We're already seeing the effects in the form of staffing shortages in critical sectors like healthcare and education.
If this trend continues, we could face a situation where the people we rely on the most are forced to move away from the areas that need them.
Moreover, the growing unaffordability of housing is likely to exacerbate social inequalities.
Homeownership has long been a key pathway to building wealth in Australia, but as more people are priced out of the market, the gap between the haves and the have-nots will only widen.
This could lead to increased social tension and a greater sense of disillusionment among younger generations who feel that the system is stacked against them.
Is there a solution?
The obvious answer is that we need more affordable housing, but achieving this is easier said than done.
It's going to require coordinated action from all levels of government, as well as the private sector.
We need policies that incentivize the construction of affordable housing, as well as initiatives that help key workers purchase homes in the communities where they work.
There are also broader economic factors to consider, such as wage stagnation and the rising cost of living.
Addressing these issues will require a multifaceted approach, but if we don't tackle them head-on, we're likely to see the problem of housing affordability get even worse.
By the way... The federal government's initiative of building 1.2 million new dwellings in the next five years won't address the problem of affordable housing.
In general they are looking for developers to build in the inner and middle ring suburbs of our capital cities, where the land is most expensive, and to build medium and high density apartment towers which cost significantly more to build than houses in the outer suburbs.
So while it is unlikely that we will reach the target of building enough dwellings to meet demand, even if we do, these will not be affordable dwellings.
