Chart: If you want a cheap house, don't go to Australia

This Sydney mansion recently sold for a measly A$53m. Image: GREG WOOD/AFP/Getty

Australian house prices are some of the highest in the world: according to the IMF, only Belgium and Canada have a higher house price/income ratio.

And they're still going up. Here’s a chart showing the house price increase in four major Australian cities since 2002. (Note that it doesn’t show prices in absolute figures, but as a ratio of where they stood in 2003-4.)

Quarterly house price index, with 2003-2004 taken as 100 per cent. Data was not available for Melbourne. Source: CityMetric Intelligence

In terms of price, Sydney’s properties are the most expensive – the median house price in July 2014 was A$812,000.

In terms of growth since 2002, however, it’s Perth that’s miles ahead of the pack. The explanation lies in Western Australian mining boom. For the past ten years, Perth's minerals and petroleum industry has grown by an average of 15 per cent a year, mostly due to rising demand from China. That industry has created jobs, raised salaries, and attracted international buyers to Perth. Research from Savills Australia has shown that the rise in house prices is in direct correlation to the increase in mining employment.

There’s another factor at work: low interest rates. Investing in property offered a higher return than keeping money in the bank, so those who benefited from the long economic boom spent their gains on houses. Their gamble has so far paid off.  In 2000, Perth's median house price was less than A$200,000. Now, it's almost A$500,000, and the Real Estate Institute of Western Australia has predicted it'll rise to A$600,000 by the end of 2014.

Prices in Perth have, finally, started to cool: this might be because the Chinese market is slowing and there's less demand for their petroleum and minerals. And in June, Moody's, the credit-ratings firm, warned that the real-estate market in Australia as a whole may be overheating: in Sydney, house prices have jumped 16 per cent in a single year. That said, increased property prices have not so far led to a construction boom: constrained supply may make a full-scale property crash a little less likely. 

 
 
 
 

Coming soon: CityMetric will relaunch as City Monitor, a new publication dedicated to the future of cities

Coming soon!

Later this month, CityMetric will be relaunching with an entirely new look and identity, as well as an expanded editorial mission. We’ll become City Monitor, a name that reflects both a ramping up of our ambitions as well as our membership in a network of like-minded publications coming soon from New Statesman Media Group. We can’t wait to share the new website with you, but in the meantime, here’s what CityMetric readers should know about what to expect from this exciting transition.  

Regular CityMetric readers may have already noticed a few changes around here since the spring. CityMetric’s beloved founding editor, Jonn Elledge, has moved on to some new adventures, and a new team has formed to take the site into the future. It’s led by yours truly – I’m Sommer Mathis, the editor-in-chief of City Monitor. Hello!

My background includes having served as the founding editor of CityLab, editor-in-chief of Atlas Obscura, and editor-in-chief of DCist, a local news publication in the District of Columbia. I’ve been reporting on and writing about cities in one way or another for the past 15 years. To me, there is no more important story in the world right now than how cities are changing and adapting to an increasingly challenging global landscape. The majority of the world’s population lives in cities, and if we’re ever going to be able to tackle the most pressing issues currently facing our planet – the climate emergency, rising inequality, the Covid-19 pandemic ­­­– cities are going to have to lead the way.

That’s why City Monitor is going to be a global publication dedicated to the future of cities everywhere – not just in the UK (nor for that matter just in the US, where I live). Our mission will be to help our readers, many of whom are in leadership positions around the globe, navigate how cities are changing and discover what’s next in the world of urban policy. We’ll do that through original reporting, expert opinion and most crucially, a data-driven approach that emphasises evidence and rigorous analysis. We want to arm local decision-makers and those they work in concert with – whether that’s elected officials, bureaucratic leaders, policy advocates, neighbourhood activists, academics and researchers, entrepreneurs, or plain-old engaged citizens – with real insights and potential answers to tough problems. Subjects we’ll cover include transportation, infrastructure, housing, urban design, public safety, the environment, the economy, and much more.

The City Monitor team is made up of some of the most experienced urban policy journalists in the world. Our managing editor is Adam Sneed, also a CityLab alum where he served as a senior associate editor. Before that he was a technology reporter at Politico. Allison Arieff is City Monitor’s senior editor. She was previously editorial director of the urban planning and policy think tank SPUR, as well as a contributing columnist for The New York Times. Staff writer Jake Blumgart most recently covered development, housing, and politics for WHYY, the local public radio station in Philadelphia. And our data reporter is Alexandra Kanik, whose previous roles include data reporting for Louisville Public Media in Kentucky and PublicSource in Pittsburgh, Pennsylvania.

Our team will continue to grow in the coming weeks, and we’ll also be collaborating closely with our editorial colleagues across New Statesman Media Group. In fact, we’re launching a whole network of new publications this fall, covering topics such as the clean energy transition, foreign direct investment, technology, banks and more. Many of these sectors will frequently overlap with our cities coverage, and a key part of our plan is make the most of the expertise that all of these newsrooms combined will bring to bear on our journalism.

City Monitor will go live later this month. In the meantime, please visit citymonitor.ai to sign up for our forthcoming email newsletter.


As for CityMetric, some of its archives have already been moved over to the new website, and the rest will follow not long after. If you’re looking for a favourite piece from CityMetric’s past, for a time you’ll still be able to find it here, but before long the whole archive will move over to City Monitor.

On behalf of the City Monitor team, I’m thrilled to invite you to come along for the ride at our forthcoming digs. You can already follow City Monitor on LinkedIn, and on Twitter, sign up or keep following our existing account, which will switch over to our new name shortly. If you’re interested in learning more about the potential for a commercial partnership with City Monitor, please get in touch with our director of partnerships, Joe Maughan.

I want to thank and congratulate Jonn Elledge on a brilliant run. Everything we do from here on out will be building on the legacy of his work, and the community that he built here at CityMetric. Cheers, Jonn!

In the meantime, stay tuned, and thank you from all of us for being a loyal CityMetric reader. We couldn’t have done any of this without you.

Sommer Mathis is editor-in-chief of City Monitor.