Sydney is Australia’s most ‘overvalued city’, according to a poll released today by PRDnationwide.
According to the poll, 28 per cent of property investors believe Sydney house prices are overvalued, while 26 per cent said Brisbane homes were above a fair market price.
PRDnationwide research director Aaron Maskrey said Darwin followed closely with 13 per cent of the 1,200 respondents saying it was also overvalued.
Only 3 per cent of investors thought Adelaide, Hobart and Canberra were overpriced compared to other capital cities.
“Basically what this research is saying is that the average buyer feels you get less bang for your buck in Brisbane and Sydney compared to other cities,” Mr Maskrey said.
“We’ve certainly seen house prices fall during the period of economic instability – but many investors believe prices still appear too high in some cities.”
According to Mr Maskrey, some cities are in the midst of a housing bubble in which prices bear no reflection of underlying economics.
“Prices in the Brisbane LGA have increased by 11.7 per cent p.a. in the past 10 years. Wages on the other hand have increased by a lot less (4.5per cent p.a.),” he said.
The median price of a house in the Sydney statistical district is $487,500 and, according to the Australian Bureau of Statistics, average weekly earnings for Australian employees are $49,592.
Therefore, the average house price in Sydney is almost 10 times earnings.