Thousands of homeowners are being forced to make a trade-off when selling homes they can no longer afford – realestate.com.au

One in four homeowners are considering selling within the next two years, as housing costs in Australia have become the country’s biggest financial concern.

The findings inside Canstar’s latest Consumer Pulse Report point to a potential increase in listings and a market increasingly defined by cost-of-living pressures in the run-up to 2026.

In total, 26 percent of property owners are considering selling their property in the next 24 months.

The main motivations are downsizing (39 percent) and modernization (27 percent), but about 19 percent say they are considering a sale because they cannot afford higher loan payments.

Housing costs are now higher than other essential expenses, more than double what they were five years ago, surpassing groceries, utility bills, insurance premiums and home price movements.

Canstar head of research Sally Tindall said intention did not always translate into action, but the signal was significant.

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“I would say from the start that there is a difference between considering it and actually going through with it, but the fact that it is in people’s minds is telling,” she said.

“Of those considering selling, 19 percent said they are considering selling because they cannot afford the higher repayments on their loans… and it is 16 percent higher than the year before, which is very interesting because, at least for now, we are done with interest rate increases.

“We’ve seen three rate cuts this year and even then some households and some households think it’s time to sell because they can’t keep performing. You can’t keep scaling Everest.”

The pressure is greatest in Queensland, where 32 percent of owners are considering a sale, followed by Victoria (27 percent), Western Australia (26 percent), New South Wales (25 percent) and South Australia (12 percent).

Ms Tindall said generational stress was particularly acute.

Source: Canstar Consumer Pulse Report.

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For Millennials, monthly repayments on a $600,000 30-year home loan, which was taken out before the RBA’s interest rate cycle began in May 2022, have risen to around $3,734 – an increase of 50 per cent.

Gen Z renters report unrelenting tension, with half experiencing a rent increase by 2025 and the average increase now being $62 per week, up from $53 last year.

“One of the most essential things in life is having a roof over your head, so for many people that is the biggest concern these days,” says Tindall.
“Mortgage rates are significantly higher than they were three years ago… and for people who haven’t refinanced or renegotiated their loans, that’s a 50 percent increase on your largest monthly expenses.”

While some are pinning hopes on further cuts from the RBA, Ms Tindall warned this could backfire if more supply does not materialise, as a majority of existing owners surveyed (55 per cent) said they had no plans – or do not expect to be in a position – to invest in the next two years.

Canstar head of research Sally Tindall. Photo: Tim Hunter.

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For those open to buying, the main triggers are macroeconomic: lower cost of living (24 percent) and lower real estate prices (24 percent), followed by lower interest rates (20 percent).

“I think this could be a drag in the long term because if we see further rate cuts, people will be able to borrow more… which increases demand. And the biggest problem we have at the moment with rising prices is the imbalance between supply and demand,” Tindall said.

“There are so many people looking for homes in major property hotspots, but there aren’t enough homes for sale, so interest rates can really fuel that demand and then continue to drive up property prices, which in turn makes it even harder for first home buyers to actually get a foothold on the property ladder.”

Source: Canstar Consumer Pulse Report.

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Evy Kassiotes, 26, recently appeared on social media to claim that home ownership had not quite met her financial expectations.

“Owning a house is basically such a scam,” she said.

‘I received a letter in the mail telling me about the progress of our loan and how much we have paid off.’

Ms. Kassiotes then expressed her shock at learning how little dent she had made in her mortgage in almost two years.

“What do you mean we’ve only paid off $3,000 since October 2023? It’s now May 2025,” she said.

“Like, are you kidding me? Is this a joke? Am I being made fun of?”

Evy Kassiotes called owning a house “such a scam.” Image: TikTok/evy.kassiotes

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Home lending expert Richard Whitten said new data shows that the cost of owning a home over the life of the loan was almost double the sticker price – in some cases more than double – and that anything people could do to shorten the term of that loan would mean savings for the homeowner.

“First-time buyers will almost certainly underestimate the long-term costs of home ownership – it is effectively impossible to fully assess them,” he said.

“Interest charges on home loans are enormous. Home insurance premiums have risen sharply in recent years (and) then there are strata, maintenance and repairs, upgrades, the list is endless.

“But the positives are really positive.

“By paying off the principal on the loan, you build your equity, and the value of the property will most likely increase over time.

“And if you can pay off the loan faster, those interest costs decrease.”