Known for having some of the most expensive property in the world, Australia has seen significant growth in exclusive million dollar suburbs in the past decade. Victoria is no exception, with many suburbs recording million plus median house prices each year. However with soft trading conditions over the past 12 months, suburbs at the top end have been impacted by the retreat of buyers from the market. The latest median price data released by the Real Estate Institute of Victoria (REIV) shows that Melbourne’s exclusive million dollar club has suffered a few casualties over the past 12 months – with six fewer suburbs making it into the million plus club since last year.
Six suburbs drop off the million dollar perch
First quarter median house prices have revealed that six suburbs have not made it into the million dollar club, despite having million dollar medians last year. Flat market conditions have impacted these more exclusive suburbs, causing their medians to fall short of the $1 million mark.
These suburbs include St Kilda East ($875,000); Port Melbourne ($921,250); Balwyn North ($980,000); South Melbourne ($967,000); Carlton North ($837,250) and Prahran ($940,000). Of these suburbs, St Kilda East suffered the biggest decline in median price over, with the median house price declining from $1,125,000 in quarter one last year to $875,000 in quarter one this year.
Suburbs in the $1 million club
From having just 4 suburbs in the million dollar club in 2005, the list has steadily increased to 21 suburbs in 2012, yet this is still 6 suburbs less than 2011. Rounding out the top three positions are the inner Eastern suburbs of Toorak ($1,860,000), Canterbury ($1,676,250) and Malvern ($1,585,000).
Million dollar suburbs Q1 2012
*Median price is based on less than 30 house sales
With a recent cut to interest rates by the RBA, there is a lot of talk as to how this will impact the market and what the flow on effect will be. Over recent weeks we have seen the market begin to show some positive early signs of improvement with clearance rates reaching 61% and 63%. However we will continue to monitor the market to determine if this is the start of a longer term trend. As for million dollar suburbs, as buyers start to re-enter the market we are likely to see suburbs that have recently dropped off the million dollar suburb perch to re-establish their position in the elite club.