My understanding is that house prices have for a lot more than 5 years been like this - for at least 20 - someone was saying at the meetup that it was at least 40 that they had been increasing about 2% (I think it was) per year more than wages. There is no sudden rise - it is just that the gradual rise has gradually been making things worse. When I bought my first house many years ago, people paid about 4 times their wage for a house even though if I quoted you a figure you would not believe it, because wages have gone up so much.
So they have crept up rather than bouncing up - which seems reasonable to me, because I cannot think of any year when there has been a sharp price rise over the board (I am excluding the mining bubble of Perth). But if you add 2% per year over and above what people are earning, it gradually becomes a very big thing. At the meetup, Ozstashe said that the 2% rise per year means that in 100 years nobody at all could afford any house. At some stage, the break point must be reached where the trend cannot continue.
Australians have always had a lot less people in the bush than other countries - even when I was in primary school our text books showed us that there were a lot less farmers in Australia per head of population than in other countries, and mechanisation of our farming practices has increased over the years. Farms have fewer people in them, so country towns are servicing fewer people. I'm sure you have seen the desperate efforts of country towns to retain their shops and their schools - the $1 rent houses being offered in some towns. When I was little, we caravaned from Queensland to Victoria each year. If I travel the same roads now, I see so many towns that have many more empty shops than then, and are no bigger.
Houses are also becoming bigger - in the same way, it has been gradual, and has been happening ever since Europeans came to Australia - we have doubled our standard of living (including our house) every generation - this was the theme of an MBA lecture. I'm sure that this is not sustainable either.
It is interesting that the article points out that once cities hit one million people, houses become much more expensive. In Australia that has happened to every capital city quite recently.
Other points the article says keep house prices up are artificial, and could (if governments of all kinds wanted to) be removed.
The problem (as I see it) is that many younger people are simply blaming their parent's generation for house prices, rather than the real culprits, so there is no impetus for politicians to change the rules. Especially as lobbyists exist for the real culprits. Of course, because the change has been so gradual, their parent's generation don't really think there is an issue - house prices have always been expensive.
