Sydney’s price growth may be attributed to population convergence, a phenomenon experienced by London, New York, Singapore and Tokyo, says Onthehouse.com.au’s market analyst Eliza Owen.

“As the growth in Sydney continues to accelerate, there is insufficient evidence attributing foreign investment and tax structures to this surge. However, there is another force to consider: population convergence – a theory utilised by urban studies theorist Richard Florida in 2005,” Owen explained.

If this theory holds true, Sydney property values and rents are unlikely to fall into line with other Australian capitals in the future, according to Owen.

Although house values in Sydney will eventually stabilise, they are likely be at a level “that even the most wealthy and mobile will find excessive”.