The average first-home buyer household is priced out of 88% of the housing market, sparking warnings the mass immigration-fuelled affordability crisis will result in Australians having fewer children.
According to a new analysis by KPMG, the average first-home buyer household income is now $180,000, which provides access to just 12% of housing stock, while in 2019/20 first-home buyers earned $150,000 but could afford 30% of available housing.
In NSW the situation is even worse, with the figure dropping to 5% but unchanged from five years earlier. In Victoria it is 10%, down from 15%, in Queensland it has plummeted from 60% to 15%, in South Australia it has crashed from 75% to 25%, and Western Australia saw another massive fall from 60% to 25%.
| Selected States | 2019-20 | 2024-25 | Percentage change |
| NSW | 5% | 5% | 0% |
| VIC | 15% | 10% | -33% |
| QLD | 60% | 15% | -75% |
| SA | 75% | 25% | -67% |
| WA | 60% | 25% | -58% |
| Australia | 30% | 12% | -60% |
KPMG Urban Economist Terry Rawnsley told The Australian Business Network soaring prices meant first-home buyers could result in smaller families and a fertility rate crash like was seen in the 1970s.
“A young couple hoping to buy their first home and have a couple of kids after that, they’re looking for a three-bedroom home for example,” he said.
“With affordability the way it is, they might only be able to afford a two-bedroom home. So they might be thinking, ‘Well I would have liked to have had two kids, but now with my house having two bedrooms, I’m only going to have one child’. They’re foregoing having more kids or they might not have kids at all.”
Mr Rawnsley also pointed out that the average first-home buyer needed to be earning far more that the average $145,000 earned by two full-time workers, and said new buyers were increasingly priced out of major cities and surrounds.
The situation is equally dire for renters, with analysis from Domain showing this week that an annual income of at least $112,667 is now needed to rent the median capital city home without entering financial stress, a 50% increase since 2019.
Australia’s birth rate fell to a record low of 1.481 in 2024, down from 1.499 a year earlier and 1.795 in 2023, according to Australian Bureau of Statistics data released in October.
The figures come after a Resolve poll from earlier this week found 64% of Australians want immigration paused until the housing situation can catch up.
Header image: Left, a packed auction in Sydney in July (TikTok @ghostmodeon27). Right, a Melbourne suburb (Tom Rumble on Unsplash).
The post Birth rate warning as housing affordability more than halves in just 5 years first appeared on The Noticer.
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