UNSW economist warns housing pressures could last into retirement

Lower home ownership among younger Australians could mean more financial pressure in retirement, less spending power during working life and fewer chances to build wealth.

UNSW Sydney published the analysis on 3 September 2026. It featured Scientia Professor Richard Holden, the university’s Vice-Chancellor’s Professor and Chief Societal Economist.

House prices have risen faster than incomes for many younger Australians. As a result, buying a home has become harder to use as a path to financial security.

Holden said the gap between people who own property and those trying to build wealth from scratch affects more than the housing market.

“If people think that they’re never going to own a home, never going to be able to build wealth, it’s a very human, natural reaction to say, ‘Well, I may as well enjoy myself,'” Holden said on a recent episode of The Business Of podcast.

He said people who feel locked out of their financial future may be less likely to invest in themselves, their communities or the wider economy.

Richard Holden points to skills and saving

For people without inherited wealth or property, Holden said the most reliable investment is building skills that stay valuable as the economy changes.

“Invest in yourself, invest in your own skills,” he said.

For people working for an employer, he said it is important to keep adapting and to re-tool skills over a lifetime.

Saving also remains important, although tax changes have made it less attractive than it once was.

“Just because the tax rate’s higher now doesn’t mean that saving is not a good idea,” Holden said.

Younger Australians are not necessarily worse off than their parents when total lifetime consumption is counted. However, delayed life milestones and a lack of affordable housing have left many feeling behind.

Longer periods in education, later marriage and later household formation have changed the timing of major financial steps.

Retirement is a key pressure point because Australia’s system assumes many people will own their home when they stop working. Renters in retirement would need more superannuation to cover housing costs.

Meanwhile, large mortgage repayments can leave homeowners with less money to spend on other goods and services during their working lives.

Related: Property crash