The Income Wall: the salary you actually need to buy a home in every Australian capital
Everyone talks about the deposit. But for a lot of first home buyers the deposit is not the wall. The wall is income. We worked out the salary a household needs to buy the median home in each capital without tipping into mortgage stress, and put it next to what the typical local household actually earns. In 7 of the 8 capitals, you need to out-earn the typical household just to buy the middle home.
The short version. To buy the median Sydney home without mortgage stress you need about $246,400 a year. The typical Sydney household earns about $125,285. That is the wall. The only capital where the typical household clears it is Darwin, where high public-sector pay meets the cheapest capital-city housing.
The income wall, by capital
"Income needed" is the gross household income at which repayments on the median home stay under the 30% mortgage-stress line, assuming a 20% deposit and a 30-year loan at the most recent published variable rate of 5.92%.
| Capital | Median home | Income needed | Typical household income | You need |
|---|---|---|---|---|
| Sydney | $1,295,387 | $246,400 | $125,285 | 2x |
| Brisbane | $1,101,151 | $209,454 | $111,532 | 1.9x |
| Adelaide | $937,021 | $178,234 | $93,375 | 1.9x |
| Perth | $1,017,698 | $193,580 | $112,497 | 1.7x |
| Hobart | $737,742 | $140,329 | $93,013 | 1.5x |
| Melbourne | $828,249 | $157,544 | $114,668 | 1.4x |
| Canberra | $892,800 | $169,823 | $143,139 | 1.2x |
| Darwin | $618,596 | $117,665 | $133,247 | 0.9x (clears it) |
"You need" = income needed divided by the typical household income. Above 1.0x means the typical household falls short.
Why this matters more than the deposit talk
A scheme like the 5% Deposit Scheme solves the deposit. It does nothing for serviceability. The bank still has to be satisfied you can repay, and on these numbers most households in most capitals cannot service the median home on a single normal income. That is why two people on solid salaries can still get knocked back, and why the deposit is often the easy part.
The part a broker actually changes
Here is the thing about serviceability: lenders do not assess it the same way. The same household, same income, same debts, can be assessed for materially different borrowing power from one lender to the next, because they treat HECS, overtime, bonuses, casual income and living-expense benchmarks differently. That spread is exactly where a broker earns their keep, by taking your situation to the lender that reads it most generously. It is free to you, because the lender pays them.
Find out your real borrowing power
Run your own numbers with our borrowing power calculator, then we will match you with a broker who knows which lenders assess your income most generously. Free, the lender pays them.
Get matched with a free brokerMethodology and sources
We took each capital's median dwelling value (Cotality Home Value Index, as at 31 March 2026), assumed a 20% deposit and a 30-year principal-and-interest loan for the other 80%, and used the most recent published average variable rate for new owner-occupier loans (5.92%, RBA, April 2026 reference month). "Income needed" is the gross household income at which those repayments stay at or under 30% of income, which is the standard definition of mortgage stress in Australia.
Typical household income is the ABS 2021 Census median household income for each greater capital city, indexed to 2026 by roughly 16% to reflect ABS wage growth since the Census (the next official per-city figure comes with the 2026 Census). We index it up rather than use the raw 2021 figure precisely so the gap is fair, not exaggerated. Three honest caveats. First, the RBA raised the cash rate to 4.35% on 6 May 2026, just after that reference month, so new variable rates are now around a quarter of a percentage point higher, which only pushes the income needed up from here. Second, banks also stress-test at your rate plus APRA's 3 percentage point buffer, so the income to actually be approved is higher still. Third, Cotality medians blend houses and units, so a buyer chasing a house specifically faces a taller wall again (Sydney's median house alone is $1,601,782). Every figure here is reproducible from the public sources: Cotality Home Value Index, ABS Census household income, and RBA lenders' interest rates.
Related
- The 5% Deposit Trap, how the deposit scheme is inflating the cheap end of the market.
- The 5% Deposit Map, what your deposit reaches in each capital.
- Borrowing power calculator, work out your own number.