Sydney father says his sons likely to wait for inheritance as home prices outpace wages

A Sydney father has told a property app he expects his two teenage sons will probably not be able to afford their own homes until they inherit the family house, reflecting wider affordability pressures facing young Australians.

The 49-year-old, who said he bought the home in 2001 and still has about $30,000 in his mortgage redraw, told Copposit that his mortgage remains his biggest expense and that he has no other outstanding loans. He said he supports a 16-year-old and a 13-year-old and that the family will likely have to "leave our one behind" so the sons can sell or use it to buy a joint property when the time comes.

The father said he advises his sons to watch spending and save where possible but acknowledged broader market forces will limit their options. "I bought back in 2001 and back then it was a hell of a lot cheaper than it is now," he said.

Recent market data show the scale of the challenge. National home prices rose 0.5% in August and 5.3% compared with the same month a year earlier, according to PropTrack. Wage growth for the year to June was 3.4%, and the median home value in Sydney is now about $1,201,000. By contrast, the Australian Bureau of Statistics records the average Sydney home was worth roughly $320,000 in 2000.

Analysts and consumer surveys indicate many Australians see family wealth as a route to homeownership. Data from the Australian Housing Monitor suggested almost two-thirds of respondents believed they would need an inheritance to buy a house, while a Finder survey found only 41% actually expect to receive one.

"Millions are quietly depending on family support to achieve their financial goals, whether it's purchasing a home, sending their kids to private school or settling debts," said Sarah Megginson, Finder's personal finance expert. She noted that high living costs and substantial wealth held by older generations in property and superannuation help explain why some people are banking on inheritances.

Economists say falling interest rates have contributed to renewed demand in housing markets after earlier rate rises, helping push prices higher in many areas. The mismatch between asset price growth and average wage increases has widened the deposit and loan-servicing hurdles for first-time buyers.

The family's account underlines how longstanding owners who purchased property in earlier cycles now hold significant home equity, while younger households face higher entry prices. Homeownership patterns shaped by asset accumulation in older cohorts have increased the role of intergenerational transfers in housing outcomes.

Policy responses debated by governments and analysts to address housing affordability range from changes to tax and land-use settings to programs aimed at boosting supply and supporting first-home buyers. Advocates for younger buyers say measures to increase the stock of affordable housing and to temper speculative demand could help, while others point to the importance of retirement security and the rights of older homeowners.

For families like the one described, the prospect is that a combination of continued price growth and slower wage rises will leave many younger Australians reliant on family assistance or inheritance to enter the property market, according to the surveys and market indicators cited.