Some people claim that Australia’s real estate market is the most overpriced in the developed world. The steady increase in house prices has resulted in a rising number of million dollar suburbs nationwide. In particular however, it is Victoria’s booming property market that has experienced some of the most substantial growth over recent years, which has resulted in a rise of million dollar suburbs.
The who’s who of million dollar suburbs
The number of suburbs in Victoria with a median house price over $1 million has rapidly increased from 4 in 2005 (Brighton, Canterbury, East Melbourne and Toorak) to 37 in 2011; 5 of which hit the $1 million mark for the first time in 2011. From these 37 exclusive suburbs, 28 had less than 30 sales, indicating that whilst they are very expensive, the median may show signs of greater variability.
The top 10 most expensive suburbs in 2011 were:
|Most Expensive||Suburb||Mar- 2011 Median|
Suburbs which also hit the $1 million dollar mark for the first time this year are Warrandyte, Fitzroy, Carlton North, Port Melbourne and Mount Albert North.
Million dollar properties also on the increase
We are not only seeing an increase in million dollar suburbs but we are also seeing an increase in the amount of properties which are being sold for $1 million plus.
Nationally, Victoria has shown the most significant increase in $1 million price tag suburbs since 2005. Data from Q1 2011 shows 193 suburbs and towns reported a $1 million+ sale, an increase of 124 in comparison with 2005. This equated to 1,071 properties in total, compared with Q1 2005’s figure of 190 properties.
Why are we seeing this trend? Most of the growth in the property market is due to natural inflation. After all, the price of housing increases like most goods and those suburbs that have medians over $1 million often increase a little faster as they are established and their supply is naturally constrained.