It’s already one of the most expensive cities in the world, but in just 20 years Sydney’s average house price will have soared to an eye-watering $3.5million.
The Harbour City is the most expensive capital in the country by a long way. It’s around 50 per cent costlier than the next most expensive capital, Brisbane, with a median house price of $1.02million, according to Propertyology research.
Based on an analysis of historical trends and the typical rate at which prices grow, a Propertyology study has revealed Sydney’s prices could more than double by 2045.
Head of research Simon Pressley said the study probed why Sydney was so much more expensive than other Australian capital cities and what the future looked like.
The report showed that because the First Fleet arrived in Botany Bay in 1788, Sydney began developing as a city much earlier than other Australian cities.
As a result, Sydney enjoyed a 40 to 60-year head-start in urban growth and development compared to the rest of the country.
By the time other cities like Brisbane (1825), Perth (1829), Melbourne (1835) and Adelaide (1836) were established, Sydney had already developed infrastructure, key amenities, a commercial centre, and had two full generations of house price growth.
Mr Pressley said major world events had also impacted prices, including gold rushes, the 1890s bank collapse, and world wars.
The average Sydney property will be worth $3.5million by 2045 (pictured, homes in Maroubra)
Despite this, he said population sizes and population growth rates had very little to do with property price growth.
At the end of World War II, large percentages of Australia’s financial capital were directed towards Sydney in a concerted effort to develop the city into a global economic centre – which had a flow-on effect on house prices.
‘It’s about revenue within a town’s economy that has the biggest influence on property prices,’ Mr Pressley said.
The report showed that in 1924, Australians were complaining about housing affordability when the price of a typical house was around $2,000.
The report also showed that most people wanted to buy a home rather than an apartment despite the large number of people who rent apartments.
Propertyology was contacted for further comment by Daily Mail.
