As an Australian fiction writer living in Australia, what factors might I consider when deciding whether to try to land a London or New York agent over an Australian one? You can assume I'd be keen to sell my work into other markets.
The most important thing to consider is whether you've written a story that will actually work in an overseas market - and to be completely honest and commercially realistic when you make the assessment. Think about which Australian novelists have been successful overseas (not forgetting Max Barry, who's doing it better than most) and what they're writing. You'll probably discover that the most successful Australian writers being published overseas are working in genre fiction - specifically, romance and fantasy - because genre fiction travels more easily.
Then bear in mind that an Australian novelist living in Australia is going to find it much more difficult to be published overseas than here, largely because it's hard for overseas publishers to find a publicity hook for this kind of work, and also because they are always going to favour writers from their home turf. It is possibly the case that you would not only have to be as good as the best writers in those countries but probably better in order to get publishers' attention.
All this sounds quite harsh, I realise, but I see it over and over again: Australian writers are usually much more eager to be published overseas than they are here, and it is exponentially harder to be published in other territories, where you're a much smaller fish in a much bigger pond. By all means approach agents overseas, if you believe your story is right for them, but don't be surprised if they reject you purely because you're Australian. If you want to be published as an international writer, certainly, approaching overseas agents is a good idea. But if you're living in Australia and it's your first novel, trust that it will take some time to build your reputation and it will be easier to start locally and find out what Australian agents can offer you in terms of overseas representation - several of them have agent and publisher contacts overseas that can be just as effective as having an independent agent there. In addition, most Australian trade publishers have their own contacts, and some of the novels that have been published overseas have come through Australian publishers, not agents.