7 March 2023 | See disclaimer
Quick Stats
- Half of the respondents feel their income hasn’t changed at all in the last 12 months.
- 48% of Australians surveyed say the cost of groceries has significantly increased in 12 months.
- The majority of respondents believe they’ll need to work for longer to retire comfortably.
- For the second year in a row, Queenslanders have noticed the biggest rent hikes compared to other states and territories.
Interest rates are climbing, monthly rent is through the roof, mortgage interest charges are up and the consumer price index continues to rise – all while wages seem to have come to a standstill.
It's no wonder the cost of living has quickly become a prime concern for most Australians, particularly for those in major cities.
To help us gauge how everyday people feel about their cost of living, we surveyed 998 Australians 18+ through Pure Profile. We then compared those findings to the latest data in Budget Direct’s Cost of Living tool as well as the results from the previous Cost of Living Survey & Statistics 2022, to truly understand the recent impacts on Australians’ living costs.
1.0 Cost of Living in Each Australian Capital City
City |
% Variance to Australian Average |
|---|---|
Sydney |
+2.2% |
Darwin |
+8.8% |
Brisbane |
+2.3% |
Adelaide |
+2.7% |
Melbourne |
+0.6% |
Perth |
-0.8% |
Gold Coast |
-6.5% |
Newcastle |
-5.5% |
Canberra |
-1.3% |
Hobart |
-9.8% |
City |
% Variance to Australian Average |
|---|---|
Sydney |
+3.6% |
Darwin |
+4.2% |
Brisbane |
-2.4% |
Adelaide |
-1.8% |
Melbourne |
+1.8% |
Perth |
-2.4% |
Gold Coast |
+5.4% |
Newcastle |
+4.2% |
Canberra |
-1.2% |
Hobart |
+6.0% |
| City | % Variance to Australian Average |
|---|---|
| Sydney | +48.7% |
| Darwin | -9.5% |
| Brisbane | +5.0% |
| Adelaide | -7.4% |
| Melbourne | -7.1% |
| Perth | -6.2% |
| Gold Coast | +13.5% |
| Newcastle | -12.5% |
| Canberra | +11.7% |
| Hobart | -10.2% |
| City | % Variance to Australian Average |
|---|---|
| Sydney | +19.9% |
| Darwin | +5.0% |
| Brisbane | +1.9% |
| Adelaide | -2.6% |
| Melbourne | +0.8% |
| Perth | +5.1% |
| Gold Coast | -4.3% |
| Newcastle | +9.3% |
| Canberra | +6.3% |
| Hobart | -7.7% |
*Data only consider 1-bedroom apartment in city centres, comparing each city’s results to the average of all Australian inner-city, 1-bedroom apartments.[1]
According to the Australian Bureau of Statistics, Living Cost Indexes (LCIs) have a baseline of 100 and measure the price change of goods and services as well as its effect on living expenses of selected household types. Higher figures represent an area as more expensive and lower figures represent areas that are less expensive.
Sydney is the country’s most expensive city to live in when compared to the national consumer price index. It also has the highest average income of all the major cities, according to Budget Direct’s Cost of Living tool.
The high cost of living index is mostly linked to the average rent in Sydney, which is overwhelmingly 48.7% higher than the Australian average.
Newcastle and Gold Coast are the only two non-capital cities that ranked in the top ten of the cost of living index, with Gold Coast having the second-highest rent sitting 13.5% higher than the national average.
Those in Newcastle, Sydney, Darwin and Perth are above the national average for income, while people in Hobart, Gold Coast and Adelaide are more likely to earn under the national average.
Overall, cost of living is up across the country with a 7.8% inflation rate of the consumer price index, which was the largest annual rise since 1990, according to the Australian Bureau of Statistics.[2]
Meanwhile, living cost indexes of different households have also risen, with employee households seeing a 9.3% annual increase while age pensioner households saw an annual increase of 7.3%.
More specific results on the cost of living can be found on Budget Direct’s Cost of Living comparison tool - which is current as of March 2022.
2.0 Cost of Living Survey Results ^
2.1 Australian respondents widely agreed that groceries have risen significantly in the last 12 months
Do you feel the cost of groceries has increased or decreased in the last 12 months?
Almost half of all respondents say grocery prices have risen significantly over the last 12 months.
To respondents, the overall price of groceries seems to be higher than it was in 2022 when the average Australian thought there had just been a slight increase.
More than half of those in New South Wales said there’d been a significant increase in the cost of groceries, as did 59% of respondents aged 58 to 67.
2.2 Australian respondents said fuel had increased in the past 12 months
Do you feel the cost of fuel has increased or decreased in the last 12 months?
| Significant decrease | Decrease | Slight decrease | No change | Slight increase | Increase | Significant Increase |
|---|---|---|---|---|---|---|
| 0.2% | 0.8% | 2.1% | 7.4% | 14.6% | 34.8% | 40.1% |
Price hikes on everyday necessities continue to be one of the biggest issues for Australians struggling with the cost of living as 40% of respondents say fuel has risen significantly in the past year.
However, this response is down from 2022’s results when 77% said they’d noticed a significant increase in petrol prices.
South Australians were one of the most heavily impacted with 56% of respondents saying fuel had significantly increased.
2.3 Renters and landlords both feel rent has increased over 12 months
Do you feel renters in your local area pay more or less, compared to 12 months ago?
| Significant decrease | Decrease | Slight decrease | No change | Slight increase | Increase | Significant Increase |
|---|---|---|---|---|---|---|
| 0.2% | 0.2% | 1.3% | 8.8% | 17.3% | 37.9% | 34.3% |
Across the board, most respondents feel there’s been an increase in the cost of monthly rent over the past 12 months.
This could be linked to the rise in housing costs due to mortgage interest charges, which the Australian Bureau of Statistics reported as being the largest contributor to increased living costs for employee households in the December 2022 quarter. [2]
Almost half of all renters that responded to the survey said they’d noticed a significant increase in the cost of rent over the past 12 months.
Meanwhile, the majority of landlords (39%) said they’d seen an increase in rent, which can be compared to 2022’s results where the average response from landlords was that they had noticed just a slight increase.
For the second year running, Queensland has been feeling the cost of living hike more than other states with 47% saying they’d noticed a significant hike in rent prices.
This is reflected in the Cost of Living index where Gold Coast (+13.5%) and Brisbane (+5.0%) averaged higher monthly rent than the national average for an inner-city one-bedroom apartment.
2.4 Despite increased living costs, Australian respondents said their income was the same as 12 months ago
Do you feel your income has increased or decreased in the last 12 months?**
| Significant decrease | Decrease | Slight decrease | No change | Slight increase | Increase | Significant Increase | N/A, I’ve retired, or this doesn’t apply |
|---|---|---|---|---|---|---|---|
| 3.4% | 4.1% | 5.4% | 48.5% | 22.4% | 8.4% | 2.2% | 5.5% |
**Respondents were given an 8th option of “NA - I don’t make income, or this doesn’t apply fairly to me”, to help exclude those who might have retired, or otherwise might unfairly skew this result.
Despite the living cost index for employee households recording its largest quarterly rise in more than two decades (3.2%), according to the Australian Bureau of Statistics, half of all participants haven’t seen a change in their income in the past 12 months. [2]
Younger demographics have seen slightly more growth than their older counterparts, with 13% of those aged 18 to 27 saying they’d seen an increase in their income compared to just 2% of those aged 48 to 57.
Compared to 2022's Cost of Living Survey results, there’s been a slight wage growth improvement, but overall the national average has remained fairly stagnant over the past two years.
2.5 Majority of the country believed they would now need to work longer to retire comfortably
Has the last 12 months changed your perception of how long you’ll need to work for, in order to retire comfortably?**
| I'll need to work for far less time. | I'll need to work for less time. | I'll need to work for slightly less time. | No change. | I'll need to work for slightly longer. | I'll need to work for longer. | I'll need to work for far longer. | NA, I've retired, or this doesn't apply to me. |
|---|---|---|---|---|---|---|---|
| 0.4% | 0.4% | 1.0% | 22.1% | 14.3% | 24.4% | 21.2% | 16.1% |
**Respondents were given an 8th option of “NA - I don’t make income, or this doesn’t apply fairly to me”, to help exclude those who might have retired, or otherwise might unfairly skew this result.
More Australians are reconsidering their futures given the current economic climate, with the majority saying they’ll now need to work for longer to retire comfortably.
Almost one in three people aged 28 to 37 say they will now have to work for far longer than they thought a year ago to retire with sufficient funds behind them.
2.6 Majority of people haven’t stopped driving despite the rise in fuel costs
Has a rise in fuel prices ever made you reconsider travelling by car?
Despite price rises and increased living pressures, more than a third of respondents say they’ll continue to drive cars, while just over a quarter say they now avoid it to save money.
^Due to how the figures are rounded within the survey data, numbers may not add up to exactly 100%
3.0 Key Findings
Australians haven’t felt a change in their income despite the rise in cost of living
Most Australians say their income has not changed in the past 12 months despite ongoing rises in the cost of living. Younger demographics have felt slightly more growth in their income than older generations.
Australians agree that monthly rent costs are up
On average all respondents say there’s been an increase in monthly rent over the past 12 months.
Landlords on average have noticed more of a rent hike this year than they did in 2022 when they said there was just a slight increase.
For the second year in a row, Queenslanders said they had noticed some of the highest monthly rent increases out of all the states and territories.
Australians say everyday necessities majorly impact the rise in cost of living
As all areas of household spending continue to rise, from electricity prices to mortgage repayments, our survey found that both grocery and fuel price hikes make some of the biggest impacts on the average household.
And while most respondents found price hikes weren’t as severe as what they saw in 2022, the rising cost of everyday necessities in the past year continues to add pressure to day-to-day life.
