Forget talk of a housing bubble in Sydney and Melbourne, says economist Janine Dixon, a senior research fellow at the Centre of Policy Studies at Victoria University. "If you are fortunate to own a packet of land in inner Melbourne or Sydney, then you are indeed fortunate because the prices there are just going up and up", Dixon said yesterday at a Melbourne Economic Forum on productivity growth. "I think it's difficult to break into that market from outside because the prices seem to be increasing at a much greater rate than household disposable income."

Dixon also discussed the rapid development of new housing outside of the major cities. "On the matter of housing as a whole, I think there's plenty of supply coming on line," she said, reported The Australian Financial Review. "Every time I go and visit family in the La Trobe Valley I see there's a new suburb out there. And I understand that by 2030, they predict another million people – that's a city the size of Adelaide – just out there in the western suburbs (of Melbourne)."