Are we building the 'right types' of property?
Much of this rather misses the point anyway. Part of the reason that Australian property in desirable locations is expensive, as noted by a number of commentators lately, is the abject failure of developers to build the types and quality of properties that buyers seek.
Much of the affordability issue boils down to the sheer weight of increase in the population, which tends to flock to the capital cities. The recent Census showed that the population of NSW increased to 7.30 million in 2011 from 6.82 million in 2006, a staggering increase over five years of close to half a million extra heads (*resist temptation to insert quip here*).
Even these statistics only score a glancing hit on the point. Pessimistic commentators furiously post about there being no housing shortage in Australia, citing super-specific examples of individual streets with empty houses on them, or else reams of national statistics which 'empirically prove' there is no such shortage. It's largely balderdash.
Demand for apartments
Every real estate commentator ought to be known for having at least one hare-brained theory. Here's mine: in a decade's time the median value of an apartment will be higher than that of a house in Australia's major capital cities.
Yes, you read that right: it will become more expensive to own a flat than a house. That's not quite as wacky as it sounds. Demand for medium-density dwellings is growing ever stronger, and as apartments tend to be located more centrally and conveniently than many houses, their median prices are outperforming those of most housing stock at this time.
Check the dwelling price stats later today and you'll begin to see the angle I'm coming from.