The number of million-dollar suburbs in Australia have soared, with new CoreLogic data revealing that there are now 218 markets across the nation selling homes for upwards of $1 million.
The explosion of these pricey suburbs is yet another sign that the pandemic – which caused Australia’s first recession in nearly three decades – has triggered an all-time high for the country’s property market, now valued at $8.1 trillion, or about four times the size of national GDP.
The 218 figure also represents a massive uptick from the previous peak in dwelling values: there were just 98 million-dollar suburbs in the year to October 2017.
The synchronised housing market upswing has led to price gains from all across the nation, ranging from 5 per cent in greater Melbourne to 20.3 per cent in Darwin, according to CoreLogic head of Australia Eliza Owen.
“Australia’s current housing boom has … push[ed] a more vast range of markets up to, and beyond, the million dollar mark,” Owen said.
Not only that, but the housing boom has also meant there are more Australian households now part of the ‘millionaire’s club’ than ever before, she added.
“The wealth effect of house value increases has likely been a key component of elevated consumer confidence, and Australia’s economic recovery from strict social distancing restrictions through 2020,” Owen said.
“The increased value of housing also cements the asset as a pillar of household wealth and security, making up 53 per cent of household wealth through the fourth quarter of 2020.”
House prices a cause for concern
But Australia’s skyrocketing house prices don’t paint a rosy picture for everyone, according to Owen, who said “there are downsides to consider”.
“For first home buyers, who tend to be more price sensitive, higher house prices have likely prevented home ownership.”
“Furthermore, current dwelling value rises have been enabled by record low housing lending rates, which has increased borrowing capacity, and household debt.”
Economists and housing experts are becoming increasingly concerned by the soaring prices, which according to a panel of 87 experts are becoming a “triple crisis” to Australia’s economic stability as the wealth and income gap continues to widen.
Though the country’s national interest rate is currently at an all-time low of 0.1 per cent, pundits aren’t expecting it to stay this way as the economy rebounds.
Australia’s largest lender, the Commonwealth Bank, late last week moved to make it harder for Aussies to get a home loan after a call from the prudential regulator for big banks to manage risky lending.
218 million-dollar markets: A breakdown
Of the 218 markets, 198 are house markets, and only 20 are unit markets.
One in four of all new markets are based in Sydney, which is now home to 54 million-dollar suburbs.
Harbour City is home to Australia’s most expensive properties, with the median price in Sydney’s Bellevue Hill upwards of $7.6 million.
State by state, here’s the median price of a home in Australia’s ritziest million-dollar property markets, as of May 2021:
Sydney: Bellevue Hill ($7,616,288)
Regional NSW: Byron Bay ($2,343,546)
Melbourne: Brighton ($3,316,986)
Regional Victoria: Connewarre ($1,671,374)
Brisbane: Teneriffe ($2,063,937)
Regional Queensland: Sunshine Beach ($1,924,577)
Perth: Dalkeith ($2.832,349)
Regional WA: Yallingup ($1,258,355)
Unley Park ($1,710,279)
Australian Capital Territory
Battery Point ($1,336,528)