pierrec45 said...whatthe said...
How did Australia become so expensive?
Debt and cheap credit.
Nothing different in this pattern between Oz and the rest - question was "... as compared to the rest".
Earlier explanations in this thread differentiate here against USA and Europe...
Australia is geographically isolated. Until the advent of online shopping, our consumer goods markets were isolated giving local operators an monopoly/duopoly/pricing cartel. There are absolutely no alternatives in the housing markets, if you want to work in Sydney, you have to live in Sydney.
In the last five years we have seen online shopping take off due to improvements in technology and consumer awareness. Combine this with a Aussie dollar that has almost doubled against the US, and suddenly we are all regularly comparing Aussie prices with US prices. Local retailers still have to pay Aussie wages however, so are reluctant to lower prices.
Thus, certain market sectors now have to compete in the global economy whilst paying Aussie wages and still battling with the tyranny of distance from the rest of the world.