No Sydney suburbs affordable for average full-time worker

In a recent open-access article published in Cities, Bangura and Lee found that affordability in Sydney’s northern, eastern and southern suburbs was “frightening” for both apartments and freestanding houses.

“Our findings show there is nowhere in Greater Sydney where the mere reliance on average part-time or full-time income could make future entry to the market possible,” the researchers stated.

Currently, the median weekly full-time income in NSW is $1,500 per week. However, full-time workers make up only a fraction of Australia’s total workforce, with almost one in three employed Australians working part-time.

Part-time workers, who earn a median of $600 per week, “could not buy a property even if they spent their entire salary on housing,” Bangura and Lee found.

They noted that while house prices rose 23.7 per cent between December 2020 and December 2021 alone, household incomes continued to grow at a “snail pace”.

“The major consequence of median incomes not being sufficient to enter the housing market in Sydney is that households relying solely on their earnings will have limited chances of achieving home ownership,” said Lee.

With earnings no longer enough to purchase a home, prospective first home buyers must rely on supplementary income sources like existing wealth or significant cash gifts from family – the so-called bank of mum and dad.

For the many Australians who don’t have the privilege of having wealthy parents to lend a hand, housing poverty will only continue to rise.

“We may see increasing polarisation of housing submarkets where gaps between neighbourhoods continue to grow,” said Lee.

“The situation may also lead to housing-induced poverty, where households might forgo other essential activities to cover housing expenses.”

With rates of part-time work markedly higher among women, especially those with children, the study noted that female-headed households will be vulnerable to housing stress.

Young people, service sector workers, low-skilled employees, and first home buyers will also be among the hardest hit by housing poverty.

Bangura and Lee urged the government to undertake significant supply-side and demand-side housing reform to prevent the cost of housing from spiralling further.

“By boosting the supply of affordable housing, the government can help alleviate the pressure on the housing market as a whole and improve affordability for aspiring home buyers,” Lee said.