You're told inflation is running at around three per cent a year, yet when you look at your mortgage repayments, your rent, your electricity bill and your council rates, none of it feels like three per cent, does it?
That's because it isn't. Analysis we're going to unpack today shows housing costs have been climbing at roughly four per cent a year since the year 2000, and some parts of that bill, like electricity and gas, have more than quadrupled.
Now, just to be clear, I'm not talking about the cost of residential real estate – we know that has gone up significantly more doubling every 10 years or so. But today we're talking about the costs everyday Australian consumers spend on their living and housing and keeping a roof over their heads.
And here's the part that's going to surprise a lot of you. The biggest culprits behind those rising costs aren't investors, they aren't developers, and they aren't even overseas events. In large part, they're governments, at every single level, federal, state and local.
In this episode I speak with Simon Kuestenmacher about why the cost of living feels very different from the headline inflation number and by the end of this show, you'll understand exactly which housing costs have outpaced everything else, why renters may actually be carrying more of this burden than anyone realises, why blaming property investors for the housing crisis misses the real story completely, and what would actually need to change for Australia to get affordability back under control.
We unpack how housing, utilities, and everyday expenses have outpaced CPI for decades.
We look at how electricity and gas have surged far faster than wages and official inflation measures.
We discuss why renters, mortgage holders, and outright owners experience the same economy in very different ways.
We explain how government policy, taxation, and planning decisions have quietly shaped Australia's housing affordability crisis.
Takeaways
• Housing costs have compounded faster than CPI, creating a long-term affordability gap.
• Electricity and gas bills have outpaced incomes, squeezing household budgets across Australia.
• CPI understates housing pain because home prices and mortgage stress aren't fully captured.
• Renters feel inflation more sharply because rising housing costs hit their disposable income hardest.
• Property taxes and compliance charges flow through to buyers, renters, and developers alike.
• Higher state taxes can reduce investor supply, which tightens rental availability and lifts rents.
• Federal migration policy affects housing demand when population growth outruns new supply.
• Low interest rates boosted borrowing power and helped inflate property prices sharply.
• Construction productivity declines make each new dwelling more expensive to deliver.
• Prefab housing and alternative building methods may lower entry costs for future buyers.
About Simon Kuestenmacher
Simon Kuestenmacher is co-founder and Director – The Demographics Group.
Simon is a prolific media commentator on demographic and data matters and a columnist for The New Daily and The Australian newspapers.
He ranks as one of the world's Top 10 influencers in data visualisation. If you can't get enough of the kind of data that explains how the world works, make sure to follow Simon on LinkedIn or X (formerly Twitter) or any of his other social channels.
Click here for a media enquiry or if you would like to book Simon Kuestenmacher for a speaking engagement. His presentations and quirky observations are enjoyed by audiences from the financial services, property, government, education, technology, retail and professional services industries, among others.
https://www.tdgp.com.au/enquire
About Michael Yardney
Michael Yardney - founder Metropole Property Strategists has been voted one of Australia's 50 most influential Thought Leaders.
While he is best known as a property expert, Michael is also Australia's leading expert in the psychology of success and wealth creation.
Michael is a #1 best selling author of 9 books and frequently challenges traditional finance advice with innovative ideas on property investment, personal finance and wealth creation.
Follow Michael on LinkedIn or Instagram
Are you interested in property investment - let the team at Metropole build you a Strategic Property Plan to help give you clarity, direction and wealth - producing results.
Also, please subscribe to my other podcast, Property Investment & Wealth Creation Australia | The Michael Yardney Podcast. Just look for it wherever you are listening to this podcast and subscribe so each week we can unveil the trends shaping your future.
About Demographics Decoded
Demographics drive economic performance, workforce participation and long-term prosperity.
Demographics Decoded explores:
• Workforce participation trends in Australia
• Labour shortages and skills gaps
• Productivity and economic growth
• Urbanisation and employment hubs
• Small business and demographic demand
• The future of work in Australia
• Education, skills and economic mobility
• Regional economic development
If you're a business owner, investor or decision maker who wants to anticipate structural change rather than react to headlines, this podcast gives you the demographic intelligence to stay ahead.
Explore more insights at:
https://demographicsdecoded.com.au
