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


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