Falling home values have failed to improve affordability, with larger loans and higher interest rates leaving couples on typical salaries able to afford median-priced properties in just 38.61% of suburbs in 2026, down from 53.63% last year, new Compare the Market analysis shows.

The study from the upcoming Household Budget Barometer report reveals affordable options have more than halved for single buyers, while couples also face a sharp decline.

The analysis examined Cotality’s median value data across 3,363 suburbs and compared estimated repayments with median earnings, assuming an 80% loan-to-value ratio. A property was considered affordable where repayments did not exceed 30% of household income.

Single buyers face the greatest challenge. An average salary made properties affordable in just 2.83% of suburbs, down from 6.24% in 2025.

% of suburbs affordable for singles

Compare the Market property expert Andrew Winter said the conditions were especially tough for single buyers, who were often competing for units against couples priced out of bigger houses.

“It’s a weird time. Property values are coming down, which should make homes more affordable, but higher interest rates are wiping out those gains by squeezing borrowing power,” Mr Winter said.

“Meanwhile, the supply of properties that are accessible to people on a single salary is extremely limited. That’s why it’s even harder to be a single buyer this year.”

% of suburbs affordable for couples

Couples earning two average salaries could afford at least one property type in 38.61% of suburbs, compared with 53.63% last year. In most cases, the affordable properties were units.

Mr Winter said two incomes were still better than one, but the figures showed that today’s market conditions could be tough, even for regular couples.

“Affordability in the market is extremely low, and that makes it very important to understand your borrowing capacity because, if something were to happen – if one of you lost your job or needed a career break at some point – there’s very little wiggle room between your income and your repayments,” Mr Winter said.

“The average home loan is now around $731,000. On a rate of 6.25%, repayments would be about $4,502 a month. Using the rule of thumb that repayments should not exceed 30% of the household income, a household would need gross income of roughly $15,000 a month to meet those repayments without crossing that threshold.”

Brisbane was the least affordable capital, with only 12.76% of Greater Brisbane suburbs accessible to couples on two average salaries. Adelaide followed at 14.95%, Sydney at 16.88% and Perth at 22.11%.

Darwin remained the most accessible capital despite recording a decline, with 90.48% of suburbs affordable for couples.

Mr Winter said low auction clearance rates were a sign that properties were not only less affordable, but that sellers’ expectations were increasingly out of step with what buyers could afford.

“Buyers don’t want to offer too high and get into a situation where they end up in negative equity,” Mr Winter said. “It could be a difficult year or two if low confidence and global uncertainty continue to influence buyer sentiment, but realistic price expectations could help bring buyers and sellers back together.”