Australian households declined to 2.3 people this year, according to a report by the Australian Bureau of Statistics (ABS).

The latest figures come after a drop in households to 2.5 people in 2021.

The decline in the average household size of Australia is the lowest it has been since 2000. 

Retiree Sally Wilson has seen the decline firsthand with her family. 

“My household used to be quite big actually,” Mrs Wilson said.

“I had both my sons and daughter living at home, they’ve been gone for a few years now. Now it’s just me and my husband. 

“They decided to move out to pursue their lives in the city [Sydney] but all three ended up leaving there quick, it was far too expensive for them. 

“They’re now living rurally, except my daughter in Perth. Both of our sons are thinking of moving overseas.”

There are many factors for the decline of the average household size, including an increase to the cost of living and the competition that Australians now face in the housing market. 

“I always said to my kids that if it got too tough, they should come back home,” Mrs Wilson said.

“I just wish that things were easier right now, it’s almost a struggle to live”. 

Demographic trends such as declining fertility rates, economic conditions, decreasing family size, ageing populations and migration are all major factors that impact household size.  

 Data collected by Quantum Market Research’s AustraliaNOW suggests that over 40 per cent of young people from the age bracket 18-29 plan to migrate internationally.  

That amounts to 600,000 young Australians planning to leave the country by the end of the year. 

The shared factor was better job opportunities and affordability of living expenses overseas. 

The potential 40 per cent decrease in the younger age bracket could lower the household size even further in 2025, possibly setting a trend for the years to come.  

Real Estate agent, Margaret Skelton said there was no more interest  in smaller dwellings compared to larger homes.

“Larger families require larger homes, at least that’s what it was like a decade ago,” Mrs Skelton said.

“Now the interest in smaller places is up there, the cap for most people is usually at two bedrooms. 

“What is sad though, is that most people I talk to have no interest in owning property later, they are content with paying a landlord.  

“There’s uncertainty about spending money on an investment with unstable interest rates and things getting more expensive”.  

The economy of Australia had its lowest ever interest rates in 2020 at 0.10 per cent, compared to the average of January this year which was sitting at 7.4 per cent. 

The rise in inflation hit its peak in almost 30 years, but has been quelled through increased cash rates, which the Reserve Bank of Australia states will happen sooner than later. 

M Wilson’s children had plans on becoming parents before 35, now that seems like a dream. 

“They all grew up so close to one another, we had a really solid family foundation,” Ms Wilson said.  

“My sons had always spoken about having kids around the same time together, so their kids could grow up being close cousins – like siblings. 

“With how expensive everything is now, both them and their partners can’t envision having kids anytime soon, which as a mother is very hard to hear. 

“I remember saying to my husband that grandkids might not even happen in our lifetime, which broke both of our hearts”. 

Many Australian couples are choosing not to have kids, contributing to the countries ageing population, with the cost of living playing a significant role in the decision.   

The University of Canberra found that the cost of raising two children ranges from $474,000 to $1,097,000 throughout their childhood.  

Young Australian couples wanting to start a family are leaning toward a new trend – to ditch the city and move rural, which could lead to inner suburbs becoming little more than retirement villages for the generation lucky enough to hoard real estate.

Ms Skelton has also seen this shift, which is presenting a problem for future city development. 

“Most cities want people to stay and prosper,” Ms Skelton said. 

“Many properties now are a bit out of budget for new homeowners, which is probably why people are going rural.”

The Reserve Bank of Australia is hoping to return inflation to its 2–3 per cent target.