There has been considerable debate over the past decade about whether Australia is in a property bubble or not. A property bubble refers to a sharp increase in the price of property that is disproportional to income and rental prices, followed by a decline. In Australia, rising house prices have undoubtedly been an issue for many potential homeowners. Along with the average house price, the average value of outstanding mortgages on residential dwellings has also continued to increase over the past 20 years.
Housing affordability has varied across the different states and territories in Australia. In 2022, the median value of residential houses was the highest in Sydney compared to the other major Australian cities. Housing costs for Australian homeowners with a mortgage were around 15.5 percent of household income in financial year 2020. This share was higher for renters of private property in the same period.