Australia’s worsening housing crisis is increasingly shaping the outlook of younger generations, with even schoolchildren beginning to fear they may never own a home. Among them is 13-year-old Adelaide student Sebastian Muñoz-Najar, who says constant discussion around soaring house prices pushed him to calculate what the future could look like for people his age.
Using publicly available data and simple calculations, Sebastian estimated that by the time he completes university studies, the average house price in Adelaide could be nearly 17 times his projected income if current trends in wages and property prices continue. The findings left him alarmed about the future prospects for his generation.
Sebastian said the issue has changed how many young Australians view their future and the country itself. While his parents were surprised that the matter weighed so heavily on him at such a young age, they encouraged him to take constructive action rather than remain worried. Together, they launched a website detailing their calculations and started a petition demanding reforms to housing-related tax policies. The petition has already attracted thousands of supporters.
At the centre of the debate are two major tax concessions — negative gearing and the capital gains tax discount. Negative gearing allows property investors to deduct losses on investment properties from their taxable income, while the capital gains tax discount enables investors to pay tax on only half the profit earned from selling assets. Critics argue these policies have turned housing into an attractive investment tool and contributed to rising property prices across the country.
Australia is currently facing one of the world’s least affordable housing markets. Property prices in many cities are now close to 10 times the average household income, compared to around four times income levels about 25 years ago. Rental prices have also surged significantly over the same period.
Experts say the crisis stems largely from a shortage of housing supply driven by years of underinvestment in social housing, slow construction activity, and restrictive planning laws limiting development in high-demand areas. However, housing advocates and economists also argue that investor-friendly tax policies have worsened affordability pressures.
Australia’s ruling Labor government is once again considering reforms to these tax concessions, arguing that changes are necessary to reduce growing inequality between generations. Previous attempts by the party to reform negative gearing and capital gains tax during the 2016 and 2019 federal elections were unsuccessful and widely blamed for electoral losses at the time.
However, analysts say public sentiment may now be shifting as the housing crisis affects a broader section of society. Danielle Wood, chair of the Productivity Commission, described the issue as a long-building problem that has now reached a crisis stage. She said housing tax reforms have become symbolic of wider frustrations surrounding affordability and inequality.
Many younger Australians argue that the traditional belief that hard work leads to home ownership no longer reflects reality. Rising rents, larger deposit requirements and lengthy mortgages have left many struggling to enter the housing market.
Not everyone agrees with the proposed reforms. Retired couple Christine and Cliff Hill, who own multiple investment properties in Melbourne’s western suburbs, argue younger Australians should be willing to make the same sacrifices older generations made to purchase homes. They believe the reforms could discourage investment, reduce rental supply and push rents even higher.
The couple also criticised what they described as growing resentment towards baby boomers, saying investors are being unfairly blamed for a complex housing problem driven by supply shortages and increasing demand.
As political divisions continue over how to address the issue, younger Australians like Sebastian hope meaningful reforms will restore the dream of secure housing for future generations.
