More suburbs enter the million dollar club

According to experts RP Data the number of suburbs with a median price over $1 million increased to 212 suburbs nationwide.

This is despite below average sales volumes during 2010.

During 2010, 212 suburbs across the country recorded a median price of $1 million as at the end of December.

Importantly, this figure only includes those suburbs which have recorded at least 10 sales during the calendar year.

Australia’s most expensive suburb during 2010 was Perth’s premium riverfront suburb of Peppermint Grove. With a median house price of $4.6 million, Peppermint Grove is almost $1 million more expensive than the second placed suburb, Vaucluse in Sydney ($3,787,500).

Peppermint Grove in WA has been the nation’s most expensive suburb for three consecutive years now.

Of the 212 suburbs with a median price of at least $1 million, 56% were located in New South Wales - all of which were located within Sydney.

Outside of New South Wales:

• 20% of suburbs were located in Victoria
• 12.5% in Western Australia
• 6% in Queensland
• 3% in South Australia
• 2% in Australian Capital Territory (2%), and
• 0.5% in the Northern Territory.

Over the year, the number of suburbs nationally with a $1 million price tag has increased by 35%, this has occurred despite the fact that during 2010 capital city home values have only increased by 4.7%.

In 2005, just 78 suburbs across the country had a price tag of $1 million or more meaning that, in just five years, the number of $1 million plus suburbs has increased by 172%.

Victoria has recorded the greatest increase in suburbs with a $1 million price tag over the five years, increasing by 950% during the period.

Tasmania is the only state which doesn’t currently have a suburb with a median price in excess of $1 million. That State’s most expensive suburb, Battery Point, has a median house price of $750,000.

The results highlight that not only has demand and price growth been strong for premium property but they also indicate that residents are prepared to pay the hefty price to secure a property in a premium location.

During 2011 RP Data expects that there is unlikely to be a further 35% increase in the number of suburbs within the $1m club. They anticipate subdued residential property market conditions during the year and the premium sector’s performance will also likely be impacted by high interest rates and ongoing global economic uncertainty.

These conditions are likely to hamper purchaser confidence and in turn reduce the propensity of buyers to spend in excess of $1 million.