Over the past decade, the median in Sydney has increased the most. There are a lot of factors that have driven this.
Like the rest of Australia, low cost of finance has been a big factor. Similarly, strong population growth has supported housing demand.
Sydney is also a difficult city to build in, with waterways, national parks and other geographic barriers making development difficult.
This, along with planning and infrastructure issues, has limited new supply.
Ten years ago, the median for Sydney was just $401,000. It’s now $1.35 million, more than tripling over that time period.
The medians of each capital city have in fact, at least, doubled.
Although Darwin saw the lowest amount of growth, its median still increased from $269,000 to $550,000.
At an aggregate level, it’s held that property prices more than double every 10 years.
Once you get to suburb level, there are many suburbs that have seen even higher growth.
Some suburbs that have seen strong growth reflect a change in the types of homes being developed over time.
Suburbs moving from a small number of older homes to a large number of new homes often see a big jump in values, primarily due to an improvement in housing stock.
Often infrastructure is also improved – better schools, public transport and retail facilities drive housing values.
Even small changes can make a difference. An outdated retail strip revitalised by a nice cafe changes the dynamic of a suburb which can flow through to the desirability to live there.
Another major shift has been the popularity of living near water and bushland.
Even with high levels of flooding occurring at the moment and destruction caused by bushfires, this is not enough to deter people.
Even if homes are not impacted directly, insurance premiums have increased a lot in areas that are more sensitive.
Where we’ll see the most house price growth over the next 10 years is difficult to predict.
Hobart a decade ago was the most affordable capital city in Australia and no one predicted how significantly it would change to now being one of the most expensive.
Similarly, the pandemic drove values in regional Australia and in places like Canberra, another change that was certainly not expected even at the start of the pandemic.
Overwhelmingly however, liveability seems to be what people are looking for.
While this obviously has different meanings for different people, walkability, nice retail precincts, good schools and efficient public transport seem to always be on buyer’s radars.