Sydney house prices soar

Sydney house prices have soared in recent years, as the market suffers from a fever of activity.

An unrenovated house by a petrol station sold for A$2.85m this month, more than A$1m over its reserve price, reports the BBC, as conditions heat up.

Indeed, according to the IMF, Australia now has the third highest house price to income ratio in the world, with values for detached homes now 13 times the average wage, according to SQM Research.

Since 2009, RP Data says prices in the city have risen by almost 60 per cent.

"Sydney has shown the best gains of any capital city in Australia ... Very low interest rates have given prices a huge boost," Tim Lawless tells the BBC. The broadcaster also cites a lack of housing stock, complex planning laws and local government red tape as factors fuelling the fever.