Putting perspective on Australia’s housing boom

By |
The Sydney and Melbourne property markets are seeing substantial growth, but where does this leave the rest of the country?

Australia’s housing boom is often characterised by the sizeable growth in these two markets. The reality, however, is much more diverse.

Housing Industry Association senior economist Shane Garret said there tends to be a bit of a “blind spot” when it comes to the other cities.

“There seems to be a characterisation of Australian dwelling prices at the moment growing very strongly when in fact they’re growing strongly in only two of the eight capital city markets at the moment,” he said.

Outside of Sydney and Melbourne, prices have fallen in three of the capital cities with increases of less than 10% cumulatively of the remaining three over the current recovery phase.

The national median dwelling price was determined to be 5.43 times average earnings in February 2015.

Individually, Sydney was the highest (7.72) followed by Melbourne (6.60) and Perth (5.77). At the other end of the scale were Hobart (4.49), Adelaide (5.36) and Brisbane (5.45).

Garret said the national market as a whole was generally in a balanced position. 

“The prices are pretty much in line with fundamentals,” he said.

“The average earnings to price ratio around the country is pretty much in line with what it has been over the last decade. If you also take into account rental income relative to the size of the dwelling and also mortgage interest rates, all of those three indicators are aligned with one another.”

However, it was also fair to characterise the market as being one where growth is quite “divergent”.

“There are two cities that are growing quite solidly in terms of price and the remaining six are in various degrees of status with their respective price growth. They’re growing either very slowly or not at all,” he said.

With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now

Top Suburbs : west rockhampton , belmont , ropes crossing , penrith , canterbury

go back

Get help with your investment property

Do you need help finding the right loan for your investment?

When investing in property, it is important to make sure that you not only have the lowest available rate that you can get, but also have the correct loan features for your needs.

Just fill in a few details below and we'll then arrange for a local Aussie Mortgage Broker to contact you and work out what features or types of loans are right for your needs. We'll even help with the paperwork. Plus and appointment is free.

How soon would you like a mortgage?
What is your Annual Household Income i $
Do you currently own any Investment Properties?
Do you own your own residence?
How much equity do you have in all your current properties?
First Name
Last Name
Where do you live?
What number can we reach you on?
E-mail address
We value your privacy and treat all your information seriously - you can check out our privacy policy here