How Australians Afford Million-Dollar Homes
Let’s start with numbers; median property price in Australian cities
Median property prices by city
- Sydney: ~$1.752 million (as of September 2025)
- Brisbane: ~$1.101 million (as of September 2025)
- Canberra: ~$1.1 million (as of September 2025)
- Melbourne: ~$1.083 million (as of September 2025)
- Adelaide: ~$1.049 million (as of September 2025)
- Perth: ~$981,000 (as of September 2025)
- Hobart: ~$745,000 (as of September 2025)
- Darwin: ~$659,000 (as of September 2025)
Do they actually buy more properties than Malaysians?
I am not too sure but I think Australians continue to buy properties because total transactions for 2024 was over 700,000 transactions! Australian population is close to 28 million while Malaysia’s total population is close to 36 million. Our total residential property transactions in 2024 was 260,000 units and this is merely 35 percent of Australia’s number despite us having a 25 percent more population than them. This is why they are an advanced property market and we are just an emerging one yeah.
Source: australianpropertyupdate.com
“PEXA tracked settlements for 723,312 properties across Australia’s five mainland states in 2024.
That’s an increase of 7.8% on the previous calendar year.
A staggering $714.7 billion – a new annual record – was spent on property purchases in 2024.
That’s a whopping 17.3% higher than in 2023, despite subdued national home value growth of 4.9% in 2024 and despite declining or stagnating property prices in some capital cities..” Source: australianpropertyupdate.com
Prices already so high, how come they could still afford?
The major reason is because I think Australians realize having a property will help them build wealth, especially as they could see home prices rising over the years which meant that by the end of their home loan, they would have an asset which could have appreciated tremendously too. This is what people meant when they say majority of millionaires are made by the property they own. Statistically, let’s see what’s their median salary?
Based on the above, let’s take just Melbourne as an example. AUD1,833 per week x 52 weeks is AUD95,316 per year. If we look at the house price versus median salary multiple, it is 11 times. This is considered high or unaffordable.
This was what is defined as affordable or not affordable. Article: theedgemalaysia.com VPC Alliance (KL) Sdn Bhd managing director James Wong, Khazanah Research Institute (KRI) defines housing affordability as a function of both house prices and income, and a yardstick of “affordable” is a median multiple of 3.0 times.”
Anyway, 3 times is very low and hardly any country can achieve this. Not Australia, not UK, not the US and definitely not even in Singapore where the government builds most of the homes for the people. This meant if our median income is RM4,000 per month, that’s RM48,000 per year and multiple of 3 means home price must be less than RM150,000 to be affordable. Erm…
In fact not a single country in ASEAN has a multiple of 3 or lower yeah. If people salary is very low, no new houses will be built since they could not buy anyway. If prices too low, developers also would not build because low margin and need to divided into 3-4 years from approval until completion stage means it’s better to do other things versus building homes. Hope everyone understands yeah.
Can AUD95,000 salary per year apply for a mortgage for a AUD1.08 million property?
As usual, let’s look at number. No need to debate. Just numbers.
AUD5,573 per month versus a salary of AUD7,917 per month. Number wise, still doable but this person would really have to tighten his other expenses tremendously. Basically, he’s left with just 30 percent of his salary every month for everything else. Doable but super tight. Solution? Get a partner maybe? If husband and wife does it together… then the actual percentage they spend for this home mortgage is just 35 percent of the combined income per month.
Suddenly, the sun is shining brightly again. Hope this explains and we just need to now use the same example for Malaysia too. Cheers.
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