Why is Australian housing so unaffordable?

Why Australian housing so unaffordable in 2025-2026 with median house price $650K Adelaide to $1.1M Sydney and $900K Melbourne versus average salary $70K, deposit $65K to $110K 10% and mortgage $3,000 to $5,000 per month unaffordable, due to high demand low supply, immigration 500K per year, low interest rates 6% but high prices, zoning restrictions, construction costs $1,500 to $3,000 per sqm and investor tax concessions negative gearing and CGT discount. Australian housing unaffordable due to supply-demand imbalance with demand high from population growth 500K migrants per year plus natural growth 150K = 650K extra people needing 250K homes per year, but supply only 180K homes built per year, shortfall 70K homes per year causing price increase 5% to 10% per year $50K to $100K increase for $1M house. Low interest rates 2% to 6% increased borrowing capacity $500K to $1M for $70K salary, pushing prices up $200K to $400K since 2020. Zoning restrictions limit density in Sydney and Melbourne inner suburbs, with 70% of land zoned low density, limiting supply. Construction costs $1,500 to $3,000 per sqm for 150 sqm house = $225K to $450K plus land $300K to $600K total $525K to $1.05M, with labour $80 to $120 per hour and materials up 30% since 2020. Investor tax concessions negative gearing allowing $10K to $20K loss deduction and CGT discount 50% for holding 12+ months encourages investors 30% of buyers competing with owner-occupiers, pushing prices $50K to $100K higher. So Australian housing unaffordable due to demand 250K homes needed versus supply 180K built shortfall 70K, immigration 500K per year, low interest rates increasing borrowing $500K to $1M, zoning restrictions limiting density, construction costs $1,500 to $3,000 per sqm $225K to $450K plus land $300K to $600K total $525K to $1.05M and investor concessions negative gearing and CGT discount encouraging investors 30% of buyers.