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Mortgage-free: Suburbs where buyers are paying in cash

Broadbeach, Toorak and Mosman were the top suburbs for cash purchases last year.

Image of Mosman in Sydney, a property sold sign and Australian money notes. Cash purchase with no mortgage concept.
Mosman was one of the top spots for cash purchases of property without a mortgage. (Source: Getty)

Many Aussie mortgage holders are reeling after the Reserve Bank (RBA) decided to lift interest rates this week, but not all Aussies are feeling the rate pain.

More than a quarter of homes in Queensland, Victoria and New South Wales were bought with cash in 2022, according to new research by PEXA.

About $122.5 billion worth of homes were cash funded last year - slightly less than the $124.8 billion in 2021, but well above the $83.6 billion recorded in 2020.

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PEXA head of research Mike Gill said cash buyers were an “often-overlooked segment” of the property market and tended to be older and more likely to be buying in regional locations.

“Given these transactions represent more than a quarter of all residential property purchases, it is important to consider that this is a sizeable cohort of buyers who are less impacted by rising interest rates, having not taken out a loan,” Gill said.

The research highlights the “generational divide” between borrowers, he said.

“Younger homeowners are more likely to have larger home loan balances, particularly those who have purchased recently, whilst many older homeowners are likely to have paid their home loan off or be able to pay cash for a home to retire in,” he said.

“Therefore, as the RBA raises interest rates to slow the economy and fight inflation, the burden falls more toward younger Australians who are more sensitive to rising rates and less so on older generations who may in fact benefit if they have savings.”

Suburbs where people are paying in cash

Aussie cash-buyers paid more in affluent urban centres, which had higher-priced properties and larger populations.

The Gold Coast had the highest value of cash purchases, with $1.33 billion spent in Broadbeach (4218) and $1.27 billion in Surfers Paradise (4217).

Next on the list was Toorak in Melbourne (3142) with $893 million worth of cash purchases. Melbourne (3000) and Brighton (3186) also made the list with $711 million and $668 million, respectively.

In New South Wales, Mosman (2088) had the highest cash purchases at $725 million, followed by Sydney (2000) at $717 million and Darling Point (2027) at $596 million.

Regional postcodes dominated in terms of overall cash transactions in Queensland and New South Wales.

In Queensland, the top postcodes for cash purchases by percentage were Tara (4421), Russell Island (4181) and Gin Gin (4671), while Emmaville (2371), Gloucester (2422) and Woombah (2469) led the way in NSW.

A smaller proportion for cash purchases were made in regional Victoria, with Yarram (3971), Paynesville (3880) and Metung (3904) topping the list.

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