Million $ suburbs decline as values fall: Cameron Kusher

EXPERT OBSERVER

CoreLogic data to the end of January 2019 shows there were 649 suburbs across Australia that had a median house or unit value at or in excess of $1 million. 

Although this figure had increased substantially from 123 suburbs a decade earlier, it has actually fallen from 741 suburbs in January 2018. In fact, more suburb had a median of at least $1 million in 2017 (651) than do currently.

The decline in million dollar suburbs over the year occurred across houses and units; 602 suburbs nationally have a median house value of at least $1 million, down from 669 suburbs a year ago.

Meanwhile, 47 suburbs have a median unit value of at least $1 million, down from 72 suburbs a year ago.

New South Wales:

As at January 2019, there were 366 suburbs in NSW that had a median house value of at least $1 million and 46 suburbs with a median unit value of at least $1 million.

A decade earlier, 78 suburbs had a $1 million median house value but only 2 suburbs had a $1 million median for units.

While the number of million dollar suburbs in NSW has shot up substantially over the past decade, it has actually reduced over the past year.

In January 2018 the suburb count for million dollar medians was 402 for houses and 67 for units.

Sydney, accounted for 93.7% of all million dollar suburbs in NSW and all of the unit suburbs were within Sydney.

Victoria:

In Vic, there were 129 suburbs that had a median value of at least $1 million as at January 2019.

Looking at the split, only one suburb had a median unit value of more than $1 million.

In January 2009, 16 suburbs had a median value of at last $1 million which highlights the substantial increase in dwelling values over the past decade.

The number of suburbs with a million dollar median has reduced quite significantly over the past year, down from 170 suburbs 12 months ago.

125 of the 129 suburbs with a million dollar median value are located in Melbourne.

The fall in million dollar suburbs has been much greater in Melbourne than in regional Vic.

Queensland:

38 Qld suburbs had a median dwelling value of at least $1 million as at January 2019.

This figure was substantially higher than the 5 suburbs a decade earlier.

The number of million dollar suburbs in Qld has consistently increased each year since 2013 and is up from 34 suburbs in January 2018.

This increase in million dollar suburbs has occurred despite ongoing weak overall housing conditions across the state.

In Brisbane, there were 26 suburbs with a million dollar median, up from 22 suburbs the previous year while in regional Qld there was 1 suburb which was steady over the year.

South Australia:

There were 27 suburbs in SA that had a median dwelling value of at least $1 million in January 2019.

There has been significant growth in million dollar suburbs over the past decade, up from just 2 suburbs in 2009.

Although overall dwelling value growth has been minimal over the past year, the number of million dollar suburbs has risen from 19 a year ago to 27.

All 33 of these million dollar suburbs are located within Adelaide.

Western Australia:

As at January 2019, 33 suburbs in WA had a median house value of at least $1 million.

The number of million dollar suburbs was down from 35 suburbs a year ago.

A decade ago, 19 WA suburbs had a median value of at least $1 million while over recent years the number of million dollar suburbs has fallen from a peak of 39 in 2015.

Only one of the million dollar suburbs was not located within Perth.

Tasmania:

January 2019 marks the first year in which Hobart had a suburb with a median value in excess of $1 million.

The median house value in Battery Point currently sits at $1,067,186.

Although values in Hobart have risen substantially over recent years the supply of homes worth more than $1 million remains very low to other mainland capital cities.

Northern Territory:

The ongoing weakness across the NT housing market has resulted in no suburbs having a million dollar median value throughout any of the past 10 years.

Australian Capital Territory:

The ACT had 9 suburbs with a median house value of at least $1 million in January 2019 while no suburbs had a median unit value above that value point.

While the number of million dollar suburbs is up substantially from just one a decade ago, it has eased back from 10 suburbs over each of the past two years.

With credit conditions looking set to remain tight and value declines currently fastest for the most expensive properties, it is expected that in 12 months’ time the number of million dollar suburbs nationwide will have reduced further.

CAMERON KUSHER is a Research Analyst at CoreLogic