**Australia Faces Ongoing Housing Crisis Amid Rising Prices**

Australia is grappling with a significant housing crisis that has persisted for two decades. The family home is increasingly viewed as an investment rather than a basic necessity, leading to frustration among renters and contributing to wealth accumulation for some Australians.

The Reserve Bank of Australia (RBA) has maintained interest rates at 3.6 percent. Recent data indicates that total household wealth rose by 2.7 percent, or $470.1 billion, in the June quarter of 2025, primarily due to rising property and land values. As property prices continue to climb, many Australians are finding it increasingly difficult to secure home loans.

In 2017, prospective buyers in Sydney needed an average of 8.2 years to save the required deposit of $215,133 for a median-priced house. This duration has now increased to at least 13 years, assuming a first-time buyer earns an average annual income of $100,000 and saves 15 percent of their income each year. This shift means that families who could afford to buy homes two decades ago are now likely to remain renters indefinitely.

RBA Governor Michele Bullock acknowledged the severity of the situation during a recent media conference. "It's a very, very difficult situation, David. And as an individual and as a citizen, I think we're in a very difficult position with the property market, and I don't actually think that most reasonable people think that this is a good outcome," she stated.

One proposed solution to address the housing crisis is to raise interest rates, which could lead to increased unemployment and mortgage defaults, potentially correcting the property market. However, this approach is viewed as extreme. A more reasonable policy suggestion is to significantly boost housing supply to accommodate the growing population, particularly through migration.

The Treasury has advised the re-elected Albanese government to consider higher taxes and set a new housing target. The government aims to create 1.2 million well-located homes by mid-2029, which requires an annual increase of 240,000 homes. Currently, the building completion rate stands at approximately 190,000 homes per year, according to the Bureau of Statistics.

Treasurer Jim Chalmers has acknowledged the ambitious nature of this target but remains optimistic about its feasibility. However, Bullock pointed out the underlying issue of a "structural deficit of supply," indicating a persistent shortfall in housing availability to meet rising demand. Despite government efforts to address this gap, she expressed skepticism about seeing any significant progress in the next two years.