The Fading Australian Dream

Thursday, March 23, 2017

Housing affordability is currently a key issue of discussion in Australia and while there are a number of factors at play, the main price driver is that demand for houses is exceeding supply. Population growth, a trend to smaller households (and so more homes needed relative to the population), and demand for homes not only from first home buyers but also from downsizers, overseas buyers, local investors, and self-managed super funds and trusts are all fuelling price rises.

While Australia’s current annual population growth of 1.4% may seem modest, this adds almost 340,000 to our population each year- which is one new Darwin every 20 weeks or a new Tasmania every 18 months.

Where population growth is strongest, house price rises are the highest

Sydney is growing much faster than this having averaged 1.8% per annum for the last five years. It will add almost two million to its population by 2037 – which is the equivalent of adding a new Perth into Sydney. Melbourne is currently Australia’s fastest growing city and based on the current growth trends, it will overtake Sydney to become the nation’s largest city around the middle of this century. Unsurprisingly where population growth is strongest, house price rises are the highest.

Earnings growth has not kept up with house price growth

In just twenty years, the average Sydney house price has increased more than five-fold from $233,250 in 1997 to $1,190,390 today while in Melbourne prices over the same period have increased by more than six times from $142,000 to $943,100 today. While it is true that wages have increased over this time, earnings growth has not kept up with house price growth. In 20 years, average annual full-time earnings have not quite doubled from $42,010 in 1997 to $82,784 today.

The impact of growing demand on house prices is most evident when comparing prices to average earnings. Twenty years ago, the average Sydney house was 5.6 times average annual earnings while in Melbourne it was an affordable 3.4 times annual earnings. Today Sydney homes are more than 14 times average earnings, and in Melbourne more than 11 times annual earnings. While the maxim that house prices double every 10 years is not always the case and growth fluctuates, since 1997 Sydney prices have in effect doubled every 8 years while Melbourne has managed this every 6 years.

If the growth metrics over the last two decades play out over the next two, the average home in both Sydney and Melbourne in 2037 will exceed $6 million. Clearly, the Australian dream of home ownership for the next generation is fading. Young people today need almost three times the purchasing power that their parents needed to buy the average place, so even double incomes will not quite do it. Additionally, today’s new households are starting their earnings years later than their parents, having spent longer in tertiary studies, and they begin their economic life not with zero savings like their parents, but well into the negative- with interest accumulating study debts to pay off. Even if today’s emerging generations start saving harder and earlier and live with their parents longer, home ownership is still not a given.

Policy settings around migration and baby bonuses have grown the population and policies around property tax incentives, self-managed superannuation and investment provisions have fuelled property demand therefore policy support will be required to bring the great Australian dream a little bit closer to reality.

Sources: Population at 2017 (ABS). 1997 prices: Macquarie University (Abelson). 2017 house prices: Core Logic. Analysis: McCrindle

Growing number of Australians moving to New Zealand

Monday, August 15, 2016


They are calling it a slice of heaven on a budget, with a growing number of Australian families packing their bags for a better life in New Zealand.

For the first time in about a quarter of a century, we have more Australians headed to New Zealand than New Zealanders heading to Australia. We aren't talking about people as retirees or as young people, but in those middle years, those family years and those key employment years, they are the ones making the move across the Tasman and heading to New Zealand.

Most of them are ending up in the Kiwi Capitol, Wellington, where you get much more bang for your buck compared to the much more expensive Auckland.

IT Specialists are in hot demand in New Zealand, and dominate the highest paying jobs. A System’s Architect have a median salary of $125,000 per year. Although an Engineering Manager isn’t all that far behind at $105,000 per year. The lowest paying jobs see Caregivers average $32,000 per year, while an Assistant Store Manager brings in $35,000 per year.

Australians are making the move because of jobs, affordable housing and a better quality of life. For a country that for so long has been tagged as Australia’s little cousin, it appears New Zealand is all grown up.

Welcome to our blog...

We have a passion for research that tells a story, that can be presented visually, that brings about change and improves organisations. And we hope these resources help you know the times.

Our Social Media Sites

Facebook | McCrindle Research Social Media YouTube | McCrindle Research Social Media Twitter | McCrindle Research Social Media Flickr | McCrindle Research Social Media Pinterest | McCrindle Research Social Media Google Plus | McCrindle Research Social Media LinkedIn | McCrindle Research Social Media Mark McCrindle Slideshare


Last 150 Articles


Tags

Aussie home ownership sydneysiders infographic mythbusting spend millennials Gen Y sydneysider CBD households family hornsby results crime The ABC of XYZ greatness 2016 census results rising house prices conference speaker future click school students Assistant Store Manager Res Vis career Northern beaches Event Andrew Duffin society trends mccrindle research Christmas lunch sunny days money engage mccrindle in the media sector wide baby name predictions debt baby names darwin in the media events australian social research outsourcing vegetarian live the dream generation alpha charities holidays choice workers internship domestic educhat online apartments faux-ciliser property price McCrindle Speakers mover and shaker forecasting office intern Sydney Hills Business Chamber cancel plans 23 million economic skills data analyst not-for-profit earnings baby boomers Christchurch 2020 Australian Census sydney event quote sector VIC group session bus conference Population Clock friendship the average aussie insight Northern Beaches investor training TEDx social student women investing Skilling recap pharmacy GPO daily commute eliane miles rich culture education future proofing relational megatrends Wagga Wagga PSI tertiary education trends affordable house prices media release Bathburst news urban taskforce mateship marrickville seasons organisations royal baby Real Estate analysis gig mining boom REIV National Conference sector wide study changing face of sydney thought leadership pharmacies DESTEL land of the middle class innovative teacher not for profit lifestyle SA 2014 goal Adelaide poor home suburb aged care puzzle 10 years property market panel report mother's day entrepreneurial increasing densification criminal program school satisfaction collaborative mortgage growing population Territory Australian Families global capital city conference presentation internships retirement men REIV Conference baby names report couple gender meals residents professional development lalor park Melbourne Northern Territory going out owning a home trend dare to dream future proof monarchy hobart professional presenters social lives real alpha care support toys church the hills Western Australia ACF celebration learner shopping centre local communities supply and demand keynote speaker university degree poker master child care average Australian 1980 gold coast February 16 identity futurist motivate publication internet Research Executive royal family travelling research services NBRS Architecture Australian Dream Australians mentor January 26th study story presentations stay home communicate World Water Day forecast visual statistics future of education define leadership workshop spirituality #censusfail the great screenage dessert media cloudy days norwest the australian dream commuters innovation city renting social trends marriage 24,000,000 children new office event year 7 equip Australia Day 2017 Vocational education balance property ageing TED talk Northern Beaches Christian School entertainment facts census tv EFF casual holiday Australia Day small business Deaths Myth Channel Seven apartment investment housing affordability potts point workforce focus groups research data consumerism social commentator workplace culture graphs youth Charlotte future of work breakfast teachers faux-cilise states cancelling plans suburban living forum state social life rule keeper parenting menai digital Financial Planning Week narcissism acf15 wealth and income distribution participants national crime rates baby name trends census fail survey social issues high density living Generation X census 2016 victoria Wodonga "know the times" cooking overcast australian real estate offenders tea australian communities forum baby name village Aussies Tuesday Trend Australian Home public holiday plans community event NFP event collaboration teleworking new york times generations wealth inequality tuesday Australian Trends princess charlotte chairty cold families Macquarie University product DIY socialites aussie culture wages online shopping cultural diversity blaxland neutral bay rent marriages social researcher sunburnt country finance global financial crisis brand experience daily telegraph qualitative research Work place weather goals huffington post budget Netflix proactive suburbs earn staying in weekly earnings sydneycity learn population pyrmont Merry Christmas 2015 Tuesday Trends research pack Duchess of Cambridge thrive urban living index moderators guide travel australian car professional services South Australia commute entrepreneurs of today community emerging generations teach financial fears gig economy society names language shopping wolloomooloo winter christian royal influence dreams survey design trends of 2017 young australians office space authenticity case study economy school high density apartments 2013 wage Queensland trend tuesday world employment summer waverton optus my business awards geomapping business Wellington jobs affordability communications demographer belief hello fresh housing market generation James Ward speaker population milestone parents Royals father's day rain vegemite learning New Zealand transport micro apartments responsive typical australian community engagement census data 2016 census Births financial dreams baby boom mccrindle low density average sydneysider census results marketing divorce consumer sentiments Social Trend VET social analysis australian community trends report English SRE conferences trends of 2016 rental stress Australian communities entrepreneur social research religion market research NBRS dream demographic trends Valentine’s Day housing growth Kirsten Brewer careers gen alpha purpose fresh educated CPI fears Hills Shire Council population growth safe logan national private wealth social media Scouts hopes urban social researchers research faux-cilising university Love manly life perth resilience kate middleton networking communities mccrindle tea work mates hills grave decision brands emerging trends Financial Planning Association townhouses cultural diveristy deloitte schools students generation Z 2017 the changing face of trades speakers pack sun shopper's pick snapshot demographic easy rider mobile sustainable Canberra Mark McCrindle customer culturally diverse food Australian demographics omnibus tattoos 1968 follow infographics Education Future Forum australia focus group priorities cars ipswich Hornsby Shire Council personalities optimistic HSC volunteer Geoff Brailey tableau Financial Planning Association of Australia leader ashley mckenzie paying to work data local politics financial independence education future report SMART ultimo Australian Communities Trends global generations micro litter students TAS Sydney keynote speaker millionth Christmas season ease of travel twentyseventeen award winner capital cities employers group interactive speakers jobs of the future wealth distribution australian communities trends report social impact etiquette demography water ideas financial planning volunteering data Generation Y shifts WA non profit renter of the future Australian schools tips personal growth 2016 40 million millenials Australian community trends IT Specialists population map experience national wealth ethnography work-life cancelling event christianity 1994 wealth moreton bay social change sydney hills Christmas presents bondi repayments socialising average aussie brand cost of living stats rise of local education research resource cash contiki curiosity Research Director ACF17 media commentary public speaker house price rise unaffordable schools brisbane JOMO wedding ACT medicine Australian Bureau of Statistics prince george social enquiry post rationalism australians staying home more gen z data visualisation youth unemployment sports award staff FPA world youth day high density ACF 2016 royal christmas SMSF dreaming wealth and income future of shopping coffee social shifts cica emerging technologies presentation environmental scanning high school Do It Yourself know the times workplace workshop researcher bureau anzac income financial google for education friends TDE change media activity cost unemployment professional living grandparents Gen X sydney speaker organisational culture slideshare keynote housing trends woolworths work urban living Tasmania challenge ageing population insights house annual income visualisation NT screenage earning the hills shire crows nest NEETs System's Architect financial future Engineering Manager local community impact shbc communication New South Wales New Zeland demographic transformations ashley fell young people wellbeing The Daily Edition 2012 newspaper showreel ferry business index relevant list ABS clothing debate Crime Rates business performance social commentary sydney metro cartodb year 12 charity baby trends analyst ACF2017 leadership volunteering hills shire volunteers selfie google video easter healthy future area learning styles aged care eliane storytelling Australia street Caregiver VET sector growth education future FOMO Real Estate Institute of Victoria long weekend faith mythbusters infographic wall optus in depth interviews research report generational trends Word Up teaching NSW Channel 7 TED future-proof salary meetings baby names australia report office opening Kiwi home owner divorce rate public speaking middle class technology builders Sydney Australian Population buildings energy 1975 professional speaker household happiness winter blues education sector government 24 million environment engagement nfp train research visualisation housing house price demographics Queensland: QLD

Archive