I'm in a similar situation having moved to Australia (Melbourne) from Southern California. In Irvine I was paying $2165/month in rent for a 3 bedroom unit in a big rental complex, here in Melbourne I'm paying $1700/month in rent for a 3 bedroom house with a backyard. Coincidentally my next-door neighbour has just put her same-size house on the market for $650k (http://www.realestate.com.au/property-house-vic-west+footscr...). Paying that mortgage would cost at least twice as much as I'm paying in rent which shows how out of whack Aussie house prices are.

But the markets for buying and renting houses are different. Rental prices are limited by local incomes. Property prices are only limited by the amount of credit available (currently effectively unlimited in a ZIRP environment) and controls, or the lack thereof, on foreign investors. Coupled with the incredibly idiotic policies in Australia of negative gearing and interest only investor mortgages (!), Aussies have created a monstrous property bubble, and the economic & political fallout from the pop will last for decades.