The average new mortgage to buy an established house in New South Wales, Australia, has soared by more than A$200,000 in two years amid a nationwide surge in home lending, according to a report in the Sydney Morning Herald. 

As Sydney’s median house price continues to climb by almost A$850 (£450) every day, economists are warning that future wage increases will not keep up. The Australian Reserve Bank resumed cutting official interest rates in mid-2019 in a bid to get the economy expanding faster to drive down unemployment and push up wage growth, leading it to cut rates to a record low of 0.1% during the pandemic and start a quantitative easing program that has pumped more than A$200bn into the country’s financial system.

Since it started cutting rates, the average mortgage to buy an established house in NSW has jumped from almost A$554,000 to a record A$755,000 in July, an increase of 36% over two years. The average mortgage has grown in every state and territory over that period. In Victoria, it has climbed by a third to A$634,000, in Canberra it has increased by 28% to A$575,000 while across Queensland it is now A$478,000 after lifting by 22%.

Sydney’s median house price is now A$1.3m, a jump of A$308,000 over the past 12 months, or $843 a day. Melbourne’s median house price, as measured by CoreLogic, is now A$955,000 after increasing by A$473 a day over the past year.