This paper models the macro drivers of Australian housing affordability using aggregate quarterly data over the period September 1985 to June 2010 and an autoregressive distributed lag (ARDL) approach. We employ two alternative measures of relative housing affordability: the Housing Industry Association's Housing Affordability Index and the housing price-earnings multiplier. Six sets of variables are then used to proxy the economic, demographic, financial, social and other factors that influence housing affordability, including conditions relating to housing finance, housing construction activity and costs, economic growth, population, alternative investments and taxation. In the long run, the results indicate that the primary drivers of affordability are housing finance, dwelling approvals and financial assets. Interestingly, economic and population growth only have an influence on affordability in the short run, while taxation related to housing has only a limited impact on affordability in the long run. The findings also indicate the high-speed adjustment following a shock to the short-run equilibrium of deteriorating housing affordability in Australia.