Cost of Living in Australia 2025: Average Household Expenses Breakdown
A detailed breakdown of the average cost of living in Australia for 2025. See what Australian households spend on housing, food, transport, utilities, and more — with tips to reduce expenses.
Average household spending in Australia (2025)
According to the ABS Household Expenditure Survey and updated consumer price index data, the average Australian household spends approximately $1,950-$2,200 per week (or $101,400-$114,400 per year) on goods and services. This figure varies dramatically depending on location, family size, and whether you are renting or paying a mortgage. **Breakdown of average weekly household expenditure (couple with children):** - Housing (mortgage/rent, rates, maintenance): $550-$700 - Food and groceries: $350-$420 - Transport (car loan/lease, fuel, insurance, registration, public transport): $250-$320 - Insurance (health, home, contents, life): $100-$150 - Utilities (electricity, gas, water, internet, mobile): $90-$130 - Education (school fees, childcare, activities): $100-$250 - Recreation and entertainment: $100-$170 - Clothing and personal care: $60-$90 - Health and medical (out-of-pocket): $40-$70 - Other (gifts, donations, miscellaneous): $80-$130 **For a single person, the breakdown is roughly:** - Housing: $350-$500 (rent in a share house vs studio/1-bed apartment) - Food: $120-$180 - Transport: $80-$150 - Utilities: $50-$80 - Total: approximately $800-$1,200/week ($41,600-$62,400/year) These are national averages — Sydney and Melbourne are 15-25% above the national average, while regional areas can be 10-20% below. Perth and Brisbane sit close to the national average, while Adelaide, Hobart, and Canberra vary depending on the specific cost category.
Housing costs: the biggest expense for most Australians
Housing is by far the largest single expense for Australian households, consuming 25-35% of gross household income on average. In 2025, the housing cost landscape looks like this: **Median weekly rents (March 2025):** - Sydney: $720 (house) / $580 (unit) - Melbourne: $530 (house) / $480 (unit) - Brisbane: $580 (house) / $500 (unit) - Perth: $600 (house) / $500 (unit) - Adelaide: $530 (house) / $420 (unit) - Hobart: $480 (house) / $400 (unit) - Canberra: $600 (house) / $500 (unit) - Darwin: $550 (house) / $450 (unit) **Average monthly mortgage repayments:** On a median-priced home with a 20% deposit at 6.5% interest: - Sydney ($1.6M median → $1.28M mortgage): ~$8,100/month - Melbourne ($900K → $720K mortgage): ~$4,550/month - Brisbane ($850K → $680K mortgage): ~$4,300/month - Perth ($750K → $600K mortgage): ~$3,790/month **The 30% rule:** Financial advisers generally recommend spending no more than 30% of gross income on housing. On a household income of $150,000, that is $865/week. In Sydney, this means a household needs to earn at least $125,000 just to afford median rent on a house without exceeding 30% — and much more to service a mortgage. **Ways to reduce housing costs:** - Share housing can cut rent by 30-50% - Living 30-45 minutes from the CBD saves 15-25% on rent - Offset accounts reduce mortgage interest (see our guide on offset accounts) - Making extra repayments of just $100/week on a $500,000 mortgage saves approximately $100,000 in interest over the life of the loan - Refinancing to a lower rate — even 0.25% lower on a $600,000 loan saves approximately $1,500/year
Food, groceries, and dining out
Food is the second-largest expense for most households. Australian food prices have risen significantly, with grocery inflation running at 3-5% annually through 2024-25. **Average grocery costs (2025):** - Single person: $100-$150/week - Couple: $180-$250/week - Family of four: $300-$420/week **Common grocery price benchmarks:** - Milk (2L): $2.80-$3.50 - Bread (loaf): $3.50-$5.50 - Chicken breast (1kg): $10-$14 - Beef mince (500g): $7-$10 - Rice (1kg): $2.50-$4.50 - Eggs (dozen): $5-$8 - Bananas (1kg): $3-$5 - Coffee (café latte): $5-$6.50 **Dining out costs:** - Average restaurant meal (main course): $25-$40 - Pub meal: $18-$28 - Takeaway dinner (two people): $30-$50 - Fast food meal: $12-$18 **Tips to reduce food costs:** - Meal planning and batch cooking can reduce grocery bills by 20-30% - Shop at Aldi for staples — most items are 10-20% cheaper than Coles/Woolworths - Buy seasonal fruit and vegetables (asparagus in spring, stone fruit in summer) — seasonal produce is 30-50% cheaper - Reduce dining out from 3 times to once per week — saves approximately $100-$200/week for a couple - Use cashback apps like Shopback or Cashrewards for online grocery orders (1-3% back) - Cook in bulk and freeze portions — reduces food waste and mid-week takeaway temptation - Buy meat in bulk when on special and freeze — major supermarkets have 50% off specials on meat regularly The difference between a frugal and generous food budget for a family of four is approximately $10,000-$15,000 per year — a significant amount that could go toward mortgage repayments or savings.
Utilities, transport, and insurance
These three categories combined represent 15-25% of household spending and are areas where significant savings are possible: **Utilities (average annual costs, 2025):** - Electricity: $1,800-$2,800 (varies hugely by state — SA and QLD are highest) - Gas: $600-$1,200 (or $0 if all-electric) - Water: $800-$1,200 - Internet (NBN): $70-$90/month ($840-$1,080/year) - Mobile phone: $30-$60/month per person ($360-$720/year) - Streaming services (2-3 subscriptions): $30-$50/month ($360-$600/year) **Utility savings tips:** - Compare electricity plans on Energy Made Easy (government comparison site) — switching can save $300-$600/year - Solar panels: a 6.6kW system costs $4,000-$7,000 after rebates and can reduce electricity bills by 50-70% - LED lighting, efficient appliances, and smart thermostats save $200-$400/year - Review mobile and internet plans annually — you are probably paying for more data than you use - Share streaming subscriptions with family members where terms of service allow **Transport (average annual costs, 2025):** - Car loan repayments: $500-$800/month ($6,000-$9,600/year) - Fuel: $60-$120/week ($3,120-$6,240/year) - Car insurance (comprehensive): $1,200-$2,500/year - Registration and CTP: $800-$1,500/year - Servicing and maintenance: $800-$1,500/year - Tolls (Sydney/Melbourne): $500-$3,000/year Total cost of running a car: approximately $12,000-$20,000/year. For households with two cars, this is $24,000-$40,000 — often the second-largest expense after housing. **Insurance:** - Health insurance: $2,000-$6,000/year (depending on level of cover and rebate) - Home and contents: $1,500-$3,500/year - Car insurance: $1,200-$2,500/year - Life/TPD/income protection: $1,500-$4,000/year Compare insurance annually using comparison sites. Loyalty does not pay — new customer prices are typically 10-20% lower than renewal prices.
How to create a realistic household budget
Most Australians do not have a formal budget, and those who do often set unrealistic targets that they abandon within weeks. Here is a practical approach: **The 50/30/20 rule (adapted for Australian costs):** - 50% of after-tax income on needs (housing, food, utilities, transport, insurance, minimum debt repayments) - 30% on wants (dining out, entertainment, holidays, subscriptions, clothing beyond basics) - 20% on savings and extra debt repayment (emergency fund, super contributions, mortgage extra repayments, investments) **For a household earning $150,000 gross ($115,000 after tax):** - Needs: $57,500/year ($1,106/week) - Wants: $34,500/year ($663/week) - Savings: $23,000/year ($442/week) **Practical steps:** 1. Track your actual spending for 4 weeks using your bank's spending categorisation feature or an app like Frollo or WeMoney 2. Compare to the averages above — identify categories where you are significantly above average 3. Set realistic targets — cutting 10-15% from your biggest spending categories is achievable; cutting 50% is not sustainable 4. Automate savings — set up automatic transfers to a savings account or offset account on pay day, before you can spend the money 5. Review monthly — not daily (daily checking creates anxiety and fatigue) **The biggest levers for most households:** 1. Housing (refinance, offset account, consider location) 2. Transport (can you go from two cars to one? Switch to a cheaper car?) 3. Food (meal planning, reduce dining out) 4. Insurance (compare and switch annually) 5. Subscriptions (audit and cancel unused services) Even modest changes — $50/week less on food, $30/week less on transport, $20/week less on subscriptions — add up to $5,200/year. Put that into your mortgage offset account on a $500,000 loan and you save approximately $338/year in interest, compounding over the life of the loan. Use our Cost of Living Calculator and Money Check tool to benchmark your spending and identify areas for improvement.
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General information and estimates only — not financial, tax, or legal advice. Always verify with a licensed adviser or the ATO.
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