By Leanne Jopson March 19, 2025

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How much do Australians need to earn to afford average rental now?

Property Market News
How much do Australians need to earn to afford average rental now?

Key takeaways

Housing affordability has always been a challenge, but today’s rental crisis is pushing even middle-income earners into financial stress.

Essential workers like nurses, teachers, and police officers struggle to afford rent, even in regional areas.

Sydney renters on $40,000 per year would need to spend 102% of their income on rent.

Even people earning $100,000 per year struggle in Sydney, spending 48% of their income on rent.

Brisbane, Perth, and even regional cities like Wollongong and Newcastle are also becoming unaffordable.

Housing affordability has long been an issue in Australia, but a new report makes it clear, we’re in uncharted territory.

The new report, Priced Out: An Index of Affordable Rentals for Australian Voters (2025), published by Everybody’s Home, reveals a rental crisis that’s no longer just affecting low-income earners.

Today, even middle-income Australians, nurses, teachers, police officers, and other essential workers are struggling to afford rent in our capital cities.

And it’s not just in Sydney and Melbourne; affordability is worsening nationwide, from Perth to Brisbane and even regional areas.

So how bad is it?

Well, let’s put it this way:

A person earning $60,000 per year is now spending between 50% and 70% of their income on rent in many areas.
Even those on $100,000 struggle to afford rentals in Sydney, Melbourne, Brisbane, and Canberra.
If you earn $40,000 per year? You’re looking at rental costs as high as 82% of your income nationally—and in places like Sydney or the Gold Coast, it’s well over 100%.

For decades, renting was considered a stepping stone to home ownership.

But with property prices soaring and rents following suit, many Australians are stuck in the rental market indefinitely.

How did we get here?

And more importantly, what’s the solution?

Rental affordability in freefall: the key findings

The Priced Out report compares weekly rents across Australia with different income levels to assess how many Australians are experiencing rental stress.

The internationally accepted definition of rental stress is when housing costs exceed 30% of a household’s income.

National Rental Affordability Breakdown

For an average rental unit in Australia:

Income Level	Net Weekly Income	Median Weekly Rent	% of Income Spent on Rent
$40,000	$688	$566	82%
$60,000	$961	$566	59%
$80,000	$1,222	$566	46%
$100,000	$1,484	$566	38%
$130,000	$1,876	$566	30% (just affordable)

What’s striking about these numbers is that rents are unaffordable for almost every income bracket under $130,000.

In many cases, people earning $70,000–$100,000, what were once considered “comfortable” salaries, are spending well over 30% of their income on rent.

But it gets worse in the capital cities.

Where is rent least affordable?

Unsurprisingly, Sydney and the Gold Coast top the list of Australia’s most unaffordable rental markets.

But Perth, Brisbane, and Melbourne aren’t far behind:

In Sydney, a person earning $40,000 a year would need to spend 102% of their income on rent. That means rent costs more than their entire income.
Even at $100,000 per year, rent still consumes 48% of income in Sydney.
Brisbane is nearly as bad, with rents taking up 86% of income for someone on $40,000 per year.
The Gold Coast is the worst offender, with rents exceeding 116% of income at the $40,000 bracket—meaning it’s essentially impossible for lower-income earners to live there without financial assistance.

Even in regional areas, affordability is still a challenge.

In places like Wollongong, the Sunshine Coast, and Newcastle, rent still consumes 40%–70% of income for many people.

In other words, it’s not just inner-city professionals feeling the squeeze, rental stress is spreading nationwide.

Why is rent rising so rapidly?

1. Lack of social and affordable housing

For decades, Australian governments have underinvested in social housing, instead relying on the private market to provide rental accommodation.

In 1982, the federal government spent the equivalent of $164 per person on social housing.
In 2022, that figure had dropped to just $61 per person, despite population growth.

This resulted in a shortfall of at least 940,000 affordable homes, pushing more people into an already strained private rental market.

2. Investor-friendly tax policies pushing up prices

The report highlights how Australia’s tax system encourages property speculation rather than providing homes for people who need them:

Negative gearing allows investors to deduct rental losses from their taxable income, encouraging them to buy more properties.
Capital gains tax discounts make property speculation more attractive, driving up prices further.
In the last decade, these tax breaks have cost taxpayers over $86 billion—money that could have been used to build affordable homes.

3. Weak renter protections and unchecked rent hikes

The report also noted that:

Unlike many European countries, Australia has no national limit on rent increases.
Landlords can evict tenants with minimal notice in most states.
States like Victoria and the ACT have introduced some protections, but many renters still face unfair rent hikes and insecure leases.

What needs to change?

1. A National Social Housing Plan

The report calls for an urgent investment in social and affordable housing, proposing a target of 940,000 new social homes over 20 years.

Countries like Austria, France, and the Netherlands have successfully kept rents affordable by investing in government-owned rental housing.
The Australian government must step up and treat housing as essential infrastructure—like roads, hospitals, and schools.

2. Phasing Out Investor Tax Breaks

The report recommends reducing the capital gains tax discount and phasing out negative gearing over a 10-year period. This would free up billions in government revenue to fund affordable housing while discouraging speculative investment.
Of course I don't agree with this, property investors are an essential part of the rental equation because the government is not providing rental housing, however out of fairness I've included this recommendation from the report.

3. Stronger rent controls and tenant protections

Limits on rent increases to prevent price gouging.
Abolition of no-cause evictions, providing renters with more security.
Minimum rental standards to ensure basic living conditions.
Independent enforcement of rental laws, so tenants don’t have to fight landlords alone.

Final thoughts

The Priced Out report paints a stark picture: Australia’s rental crisis is no longer just a problem for low-income earners, it’s affecting everyday working Australians.

Without action, an entire generation will be locked out of stable housing, forced to spend unsustainable amounts on rent, or pushed to the outskirts of cities.

This isn’t just a housing problem, it’s an economic problem.

High rental costs affect workforce retention, productivity, and social stability.

If we’re serious about fixing the housing crisis, we need real leadership, bold policy changes, and a commitment to treating housing as a fundamental right.

About Leanne Jopson Leanne is National Director of Property Management at Metropole and a Property Professional in every sense of the word. With 20 years' experience in real estate, Leanne brings a wealth of knowledge and experience to maximise returns and minimise stress for their clients.