Australia's cash rate is now at 4.6 percent, following the Reserve Bank's decision on Tuesday to quash stubborn inflation. The last time the cash rate was higher was in October 2011, when it stood at 4.75 percent before a series of cuts began the following month.
Housing was dramatically cheaper then. In October 2011, Sydney's median house value was $598,888, Melbourne's was $472,705, Brisbane's was $458,356 and Perth's was $460,361, according to Cotality data.
Since then, housing values have more than doubled while wages have increased by about 49 percent. The national dwelling value-to-income ratio has risen from 6.5 times to 8.7 times over that period.
Cotality research director Tim Lawless described the shift starkly. "The stark difference compared to 15 years ago is that housing is much more expensive now," he said. "Even though interest rates might have been at fairly similar levels 15 years ago, the underlying dynamic of the market is radically different in the sense that housing prices are much higher than incomes and debt levels are also much higher."
Households are also carrying far more debt than they were in 2011, making the current rate environment more painful for borrowers.