The number of Australian suburbs with a median house or unit valued at or above $1 million recently hit a record high.
Almost a third (29.3 per cent) of the 4,772 suburbs analysed in August had dwellings valued at or above $1 million, according to research released this week by property research firm CoreLogic.
This is up from a recent low of 21.7 per cent in January 2023 and 14.3 per cent at the onset of the COVID-19 pandemic.
Houses dominate the charts. Some 1,257 suburbs have a median house price of at least $1 million up from 1,057 a year earlier.
But the number of million-dollar unit suburbs is on the rise too, having grown from 122 to 140 suburbs over the same period.
Where are Australia’s million-dollar unit markets?
National unit prices — connected to properties like townhouses and apartments — have risen by 5.1 per cent over the past year and 1.1 per cent over the past three months, according to CoreLogic economist Kaytlin Ezzy.
Out of the 314 suburbs in Sydney analysed by CoreLogic, there were 107 where median unit prices had breached the $1 million mark while four were in regional NSW.
In Melbourne, 11 of the 256 suburbs analysed were home to units that fell in the million-dollar-plus price range.
And thirteen areas in regional Queensland had units in the seven-figure club.
Credit: SBS News
Capital city suburbs with the priciest units
Sydney is home to five of Australia’s most expensive suburbs for units.
The median value of a unit in well-heeled Darling Point is almost at $2.5 million, while Barangaroo, Kirribilli, Millers Point and Milsons Point also above the $2 million mark.
Ashburton in Melbourne’s inner-east had a median unit price of $1.23 million.
And units in the city’s bayside suburbs including Beaumaris, Brighton and Black Rock had median price tags above $1.1 million.
Credit: SBS News
What’s driving unit prices up?
“Worsening affordability, lower demand for houses as people wait for the first interest rate cut and above average levels of new listings in the existing housing market have put an upward pressure on prices of units,” Ezzy said.
Ezzy said listings of existing dwellings are about 25 per cent above the five-year average typical for this time of year.
“The rising cost of construction has also played a role in price growth as we haven’t seen a significant flow of new houses and units into the market. We aren’t building as many as we need to meet the demand, and that’s putting upward pressure on prices,” she said.
She said construction costs had risen during the height of the COVID-19 pandemic and were unlikely to fall.
The Cordell Construction Cost Index shows national construction costs have risen by 2.6 per cent over the 12 months ending June.
CoreLogic’s findings come as the federal government faces increasing pressure to ramp up efforts to tackle.
Labor’s , with the Greens in opposition to the proposals saying they would make the crisis worse.
The Greens want the government to amend its housing bills by including a cap on rent increases, further investment in public housing and a phase-out of tax handouts for property developers.
The federal government argues boosting housing supply is the best way to solve affordability issues.
Labor is also facing renewed calls to wind back and the capital gains tax discount, amid reports treasury had carried out modelling on possible changes.
Independent senators Jacqui Lambie and David Pocock have put forward what they say is a “sensible middle path” that could save up to $16 million over the next decade and be reinvested into social and affordable housing projects.
Prime Minister Anthony Albanese his government might consider taking proposed changes on these matters to the next election.