Sydney housing market causes shocks for other cities

Adam Smith 7 September 2016

SydneyNewsSydney’s high housing prices are spilling over into other cities, a report has claimed.

Research by the University of New South Wales has claimed Sydney’s property market creates price shocks that spill into other capital cities, the ABC has reported. The study found that Hobart was the capital city most impacted by high property prices in Sydney, while Perth and Darwin were the least affected.

The study examined median house price and rent data from the early 1980s until 2015, the ABC said. Report author Associate Professor Glenn Otto then modelled how variations in capital gains and rental returns in each capital city impacted returns in other capital cities.

"We shouldn't think of Australian housing markets as being completely isolated," Otto said.

Otto said the spillover of property performance from one market into another was likely due to investors.

"Australian cities are quite isolated so we wouldn't necessarily expect people to be picking up and moving between cities in response to changes in property prices. To that extent investors may be becoming an increasingly important part of the housing market, maybe that's one mechanism by which we can see this kind of effect of one city being transferred to another city,” he said.

Otto’s findings echo recent figures from CoreLogic, which showed strong price growth for Hobart.

“We’re seeing some reasonably strong growth in Hobart and Canberra, fed mainly by people in Sydney and Melbourne buying for investment or lifestyle,” CoreLogic researcher Cameron Kusher told

Latest home loans headlines

Image: Shutterstock

More help from

Save on health insurance
Save on health insurance

Compare plans and prices to find the right deal for you

More info...
Refinancing home loans
Refinancing home loans

Choose from offers with rates as low as 3.59% p.a.

More info...
Prepaid phone deals
Prepaid phone deals

Save with a cheap and flexible prepaid SIM

More info...
Cut your power bills
Cut your power bills

Compare energy providers and find a better deal for 2017

More info...

Ask a Question

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Disclaimer: At we provide factual information and general advice. Before you make any decision about a product read the Product Disclosure Statement and consider your own circumstances to decide whether it is appropriate for you.
Rates and fees mentioned in comments are correct at the time of publication.
By submitting this question you agree to the privacy policy, receive follow up emails related to and to create a user account where further replies to your questions will be sent.

Ask a question