Purchasing property in many suburbs now necessitates a multi-million-dollar budget as property values have reached new heights, despite high interest rates constraining borrowing capacities.
In a surprising shift in Australia’s real estate landscape, the latest data from PropTrack revealed that 30 suburbs have recently entered the $2 million range, with an additional 14 reaching the $3 million mark.
This expansion includes areas previously considered more affordable, challenging the traditional boundaries of luxury real estate markets.
Traditionally, cities like Perth and Brisbane were seen as more budget-friendly compared to Sydney. However, recent trends showed these cities catching up, with significant suburbs entering the $2 million club due to robust price growth.
“Both [Perth and Brisbane] have seen really strong growth in recent years,” said REA Group’s Angus Moore (pictured above). “Prices in both are up just shy of 80% since March 2020, which is extremely strong growth.”
While the phenomenon isn’t new in Sydney’s affluent circles, the spread to other cities underscores a broader national trend.
For instance, the median house prices in the Perth suburbs of Floreat, Claremont, and Churchlands have soared, driven by their proximity to the beach and central business districts, making them prime spots for wealthier buyers.
In Brisbane, suburbs like St Lucia, Paddington, and Robertson now boast median prices of $2 million or more, reflecting a significant market evolution.
In Sydney, the effect of these price hikes is pushing further from the city’s core. Suburbs traditionally seen as more affordable are now demanding a $2 million budget for family homes.
“For affordability and space, they tend to get pushed out and that’s why suburbs like Earlwood are becoming more popular,” said Alexandra Stamatiou-Buda from McGrath Inner West.
This year, the 14 suburbs that have newly joined the prestigious $3 million club are predominantly located in sought-after waterfront locations or within Sydney’s most upscale areas.
Notably, some suburbs, such as Byron Bay—a magnet for celebrities and high flyers and one of Australia’s top coastal destinations—have rebounded to this high-status category after a temporary dip in prices, highlighting the fluctuating nature of the top-tier market.
The data not only highlighted the growing number of high-cost suburbs but also signaled shifts in where these areas are located, moving beyond their usual enclaves to include historically less expensive regions.
This trend is reshaping perceptions of value and luxury in the Australian housing market, as noted by industry experts, PropTrack reported.
Despite a general upward trajectory in prices, some suburbs have seen declines, slipping below the $2 million mark due to broader market pressures in Melbourne and the Mornington Peninsula.
Suburbs like Ashburton, Elsternwick, and Sorrento have experienced price corrections, reflecting the volatile nature of real estate investments.
Similarly, in the high-end market, suburbs such as Neutral Bay, Bayview, and Sylvania Waters have dropped out of the $3 million club.
With interest rate decisions pending, the real estate market remains on edge. The upcoming monetary policy from RBA could further influence these trends, potentially making some suburbs more accessible while others might escalate in price.
For more detailed insights, refer directly to the PropTrack report.
