Sydney’s housing market prices are climbing and economists are questioning if this will discourage migration. Three months prior to May of 2015 Sydney’s average home price was recorded to be around $880,000 and the unit price was $638,000.

Both the housing price and unit price in Sydney were the highest across each capital city. Melbourne’s comes in at second place with the average house price $259,800 lower than Sydney. As for the unit price in Melbourne was $158,000 lower.

Sydney is the largest city which is one reason why it has the largest influence on those numbers. Looking at median dwelling prices (combined houses and units), they are substantially lower outside of Sydney. Median prices are 24% lower in Melbourne, 38% lower in Brisbane, 47% lower in Adelaide, 32% lower in Perth, 56% in Hobart, 31% in Darwin and 27% lower in Canberra.

Housing data has been provided by Interstate migration and the property market.

Does the market indicate that it could be time to look elsewhere?  The value of homes in Sydney have gone up at a much faster rate in the last 12 months. Across NSW 60% of new lending is going out to investors and is even higher in Sydney.

It’s a given that people will continue to purchase homes and property in Sydney because it is the biggest city with the most amount jobs. The significant price increases in housing and offices is beginning to create a lot of opportunity for surrounding cities.  

There are major savings available for individuals willing to locate outside of Sydney. Lower mortgage rates in surrounding cities are enticing for people even though that means wages are lower in comparison to Sydney. However cost of living and wages do compliment each other.

Cities should focus heavily on providing incentives for businesses and people looking for homes to move in. This is also great for the government to provide incentives in order to collect more revenue from taxation.

Chifley Securities lends on commercial property and large residential developments in and around Sydney and, in principle, the Eastern seaboard of Australia.