The huge salary Aussies need to buy a house – so is it any wonder why our birth rate is declining?

A couple needs a combined income of more than $200,000 to afford a child and live comfortably as a renter in Greater Sydney or Greater Brisbane, new research shows.

New data from National Shelter shows just how broken the current rental system is, as it tracks different Australians at different stages of life and their rental needs.

The problem is so bad that even a wealthy couple with a child making a combined $219,000 still finds rent less affordable since the pandemic.

Greater Sydney requires this household to spend just 18 percent of their income on rent, leaving a reasonable amount for other living and parenting costs, although it becomes cheaper if they move to the suburbs.

The problem is only exacerbated for low-income or single people.

National Shelter spokesman John Engeler said renters across the country are under intense pressure as rent increases continue to outpace income growth amid historically low vacancy rates.

“The situation is especially serious for low-income tenants, who are increasingly forced to rent privately due to the declining availability of social and affordable housing,” Engeler said.

‘A single retiree would have to spend 86 percent of their income to rent an average one-bedroom apartment in Sydney.’

Mr Engeler said it was “clearly unacceptable” and called on the Government to help solve the affordability crisis through social housing.

Over the past 12 months, rental affordability has fallen by 13 per cent in Perth, eight per cent in Adelaide, six per cent in Melbourne, five per cent in Sydney and four per cent in Brisbane.

Perth is now the least affordable capital, with an average weekly rent of $629 taking up 31 percent of the median income, followed closely by Sydney, where an average rent of $720 is 30 percent of the median income.

According to the report, 30 percent of income is the limit for when rent becomes unaffordable.

Separate data from PropTrack’s Rental Affordability Report shows that ‘Australia’s rental affordability is at its worst level on record’, with households with an average income of $111,000 able to rent only the smallest share of homes since 2008, when records began.

The rental crisis is becoming a national problem

The impact of unaffordable rents could become a national problem, with higher costs, including rents, affecting the number of children families choose to have.

Rents have risen across Australia, with the average income able to rent only the smallest proportion of properties.: NCA NewsWire / David Swift

Australia’s falling birth rate could have significant implications for family dynamics and make middle children increasingly rare.

Figures released by the Australian Bureau of Statistics in late October show the total fertility rate will have fallen to a record low of 1.5 babies per woman by 2023.

Demographer Dr Liz Allen, a lecturer at the Australian National University, said the days of middle children are over as couples with one or two children become the new norm.

She said this is because it is becoming increasingly difficult for couples to get ahead financially.

“Even renting has become unaffordable in some areas, and Allens says job insecurity has also become an issue, with many young people and women forced into temporary or part-time work,” she said.

The decline in births can be attributed to the higher cost of living and the current economic climate, as this could impact the feasibility of younger Australians having children, KPMG said.

The rental crisis could have a long-term impact on the number of households in Australia. Photo: NCA NewsWire / Andrew Henshaw

Data shows the birth rate across the country fell by 4.6 percent last year, marking the 2023 birth as the lowest since 2006.

In 2023, 289,100 babies were born in Australia.

KPMG urban economist Terry Rawnsley explains that weak economic growth often leads to lower birth rates, but current pressures on the cost of living are having a particularly strong impact.

“Birth rates provide insight into long-term population growth and the current confidence of Australian families,” he said.

Sydney experienced the most notable decline: the number of births fell by 8.6 percent. This was followed by Melbourne, with a decline of 7.3 percent, Perth, with a decline of 6.0 percent, and Brisbane, with a decline of 4.3 percent.

Canberra was the only capital where the number of births has not fallen since 2019.

This increase has now rapidly declined as the current economic climate presents several challenges for Australian families.

“With the current rise in the cost of living putting pressure on household finances, many Australians have decided to delay starting or expanding their families,” Rawnsley said.

“This combination of the pandemic and rapid economic changes explains the spike and subsequent sharp decline in birth rates we have seen over the past four years.”