Australia and NZ form one housing market
Australia and New Zealand have many things in common - a similar flag, pavlova, and Russell Crowe - but economists say a singular housing market can be added to the list.
The two nations form a single but loosely-linked housing market according to a study from the Motu Economic and Public Policy Research Trust, with 16 Australasian cities affected by the same price trend.
But even though the housing markets are loosely intertwined, it doesn't mean they're carbon copies of one another according to Motu senior fellow Arthur Grimes.
"Temporary shocks such as an influx of migrants have an effect, but these wear off," he said.
"We found that all 16 cities share a price trend and are influenced by the same long-term factors."
Geographical or planning constraints may play a role in determining how each market reacts to the trend.
But generally, it's a case of follow the leader with temporary shocks first felt in Australia's five major cities before moving to other Australian markets and then heading across the ditch to New Zealand.
Sixteen cities - eight from each country - were looked at as part of the study.
These findings should impact each country's macroeconomic policy according to Motu.
"We found little evidence that monetary policy is effective in determining long-run real house prices," said Dr Grimes.
"This means governments need to look at areas other than macroeconomic policy if they are interested in controlling house prices."