‘Cactus’: Why buying a house in Brisbane just got harder – realestate.com.au

The cost of owning a home in Queensland has become even more unaffordable – especially for lower-income households, a new report has found.

A middle-income household earning just under $115,000 would be able to afford just 14 percent of all homes sold in fiscal year 2025 — down from 18 percent a year earlier, according to the PropTrack Housing Affordability Report, released today.

But conditions are not as bad as in 2007-08, when interest rates were above eight percent, the report found.

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Faster growth in house prices at the more affordable end of the market during the financial year meant that affordability continued to deteriorate for lower and middle-income households, while higher-income households could afford a slightly higher proportion of homes.

In Queensland, a middle-income household saving 20 per cent of its income for a deposit would need to save for just over six years – the highest level ever for the state, and spend around a third of its income on mortgage repayments.

REA Group senior economist Angus Moore said while New South Wales and Victoria had seen improvements in housing affordability over the past financial year, Queensland was worsening.

PropTrack senior economist Angus Moore. Image: supplied

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“The simple answer is we have just seen very strong house price growth across Queensland,” Mr Moore said. “That is not unique to the past year.

“We have been seeing this since 2020, but the fact that house prices continue to rise has more than offset the increase in borrowing capacity due to lower interest rates and higher incomes.”

Brisbane’s average house price surpassed $1 million earlier this year and now stands at $1.126 million, according to PropTrack – the second most expensive capital after Sydney.

The typical Queensland household can now afford just 14 per cent of properties sold in the state.

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“One of the things we’ve seen in recent years is that it has been very difficult to build new homes for many reasons, but one of them is the difficulty of finding skilled labor,” Mr Moore said.

“And while that’s starting to slow down a bit in New South Wales and Victoria as state government infrastructure projects get underway, in Queensland that’s likely to be less so over the next decade. And there’s still a lot of infrastructure to be delivered.”

Michael Matusik, director of Matusik Property Insights, said household incomes in the Brisbane local government area had increased by just four per cent since 2015, while house prices had increased by 125 per cent in that time.

Matusik Property Insights director Michael Matusik.

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“This gap between income growth and home values ​​is at the heart of Brisbane’s current affordability problems,” Mr Matusik said.

“For many younger households – or those who rely on what they earn in wages or salaries – buying a home in Brisbane is now a cactus.

“Buying a unit is still possible for those starting out, but most of the older resale units they can afford are either one-bedrooms or a tight supply of two-bedrooms in old walk-ups.

“Yes, many of us started our property ladder that way, but we weren’t paying five times (or more) of our take-home pay from the start, and the rungs on the property ladder weren’t that wide either.”

PropTrack’s latest Housing Affordablity Index shows the cost of owning a home in Queensland has increased over the past financial year. Photo: John Gass.

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Mr Matusik said aspiring homeowners in Brisbane now face structural barriers that income growth could not overcome unless supply and price pressures are addressed.

It comes as the latest median sales data from the Real Estate Institute of Queensland (REIQ) for the September quarter shows Queensland’s housing supply continues to cost homebuyers, putting continued upward pressure on property prices across the state.

“Across the state, prices are rising in a troubling but classic supply story – when demand exceeds the supply of new homes, prices inevitably go up,” said Antonia Mercorella, CEO of REIQ.

“The data shows that regional Queensland is driving some of the most dramatic price movements, while Greater Brisbane and surrounding LGAs remain solid but less explosive.

“The particularly strong regional gains highlight that both investors and owner-occupiers are looking beyond the southeast corner for relative value and growth.”