House Ownership in Melbourne: A Growing Challenge

1

The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.

This gap has widened significantly over the years. Back in December 2014, the price difference was $121,322, a figure more than doubled today. Looking even further back to December 2004, the disparity was only $47,976, illustrating how housing affordability has shifted over time.

A similar trend is observed across various capital cities in Australia. Using PropTrack data, it's clear that since 2010, house prices in these cities have surged by around 123%, whereas units have only risen by 64%.

Tim Lawless, CoreLogic's head of research, explained that this growing gap implies that purchasing a unit no longer automatically leads to an eventual upgrade to a detached home. He stated, “Buying a unit probably used to be a bit of a stepping stone. You buy into the apartment sector and then hope to eventually upgrade into a larger, detached home, but with such a big price difference, and the fact that it’s probably been a lot harder for unit owners to accrue equity, that upgrading step is a lot more challenging now.”

Brendan Coates from the Grattan Institute observes this from a land value perspective: “Land is scarce, and therefore it’s valuable, so if you want to have that backyard, you are going to pay a premium for it. Not everyone can have a freestanding house, and that means there’s more competition for the limited number of freestanding homes that exist.”

The outlook is that the chasm between unit and house prices will continue to grow as cities expand and population numbers soar. The Urban Taskforce has projected dramatic changes, specifically noting that the share of detached houses in Sydney may decline to only 25% by 2057.

This transformation will echo across Australia’s capital cities as challenges associated with housing density and population growth come to the fore. Increased migration rates continue to exert upward pressure on property prices and rental costs, pushing affordable housing further out of reach for many urban dwellers.

The availability of detached houses is dwindling, resulting in soaring prices and fewer households having the luxury of a backyard, altering the property landscape of Australian cities.

Such developments suggest that future homeowners and city planners alike must adapt to changing trends in housing affordability and preferences, considering alternative living arrangements or innovative urban planning solutions.

Published:Thursday, 30th Jan 2025
Source: Paige Estritori

Please Note: If this information affects you, seek advice from a licensed professional.

Share this news item:

Finance News

Clear

ASIC's Investigation Highlights Issues in Car Finance Sector

26 Nov 2025: Paige Estritori

The Australian Securities and Investments Commission (ASIC) has recently conducted a comprehensive review of the nation's motor vehicle finance sector, uncovering significant issues that raise concerns about consumer protection and lending practices. - read more

Bank Australia Halts Loans for New Fossil Fuel Cars

26 Nov 2025: Paige Estritori

In a bold move towards environmental sustainability, Bank Australia has ceased offering loans for new petrol, diesel, and hybrid vehicles as of February 2025. This strategic decision aligns with the bank's commitment to achieving net-zero carbon emissions by 2035 and underscores its dedication to promoting environmentally friendly transportation options. - read more

GFV Programs Propel $4.66 Billion Increase in Vehicle Loans

26 Nov 2025: Paige Estritori

The Australian automotive finance sector is experiencing a significant transformation, driven by the rising popularity of Guaranteed Future Value (GFV) programs. These programs have contributed to a $4.66 billion surge in vehicle loans, presenting new challenges for traditional lenders and reshaping the competitive landscape. - read more

ASIC's Findings on Car Finance: High Fees and Early Defaults

18 Nov 2025: Paige Estritori

The Australian Securities and Investments Commission (ASIC) has recently conducted a comprehensive review of the nation's motor vehicle finance sector, uncovering significant issues that raise concerns about consumer protection and lending practices. - read more

Economic Pressures Drive Australians Towards Premium Used Cars

18 Nov 2025: Paige Estritori

As Australians grapple with escalating living expenses, a notable shift is occurring in the automotive market. Consumers are increasingly turning to premium used vehicles as a cost-effective alternative to new car purchases. - read more

Extended Research Periods Mark Australian Car Buying Trends

18 Nov 2025: Paige Estritori

The Australian car market, recognized as one of the most competitive globally, is witnessing a trend where consumers are dedicating extended periods to research before finalizing their vehicle purchases. On average, Australians now spend approximately 2.8 months evaluating options before making a decision. - read more

ASIC Takes Legal Action Against Car Finance Provider for Alleged Lending Breaches

02 Nov 2025: Paige Estritori

The Australian Securities and Investments Commission (ASIC) has commenced civil penalty proceedings in the Federal Court against car finance provider Money3 Loans Pty Ltd, alleging breaches of responsible lending obligations. This action underscores ASIC's commitment to enforcing compliance within the financial sector to protect consumers. - read more

Click for more Finance News