Thursday, 17 March 2011
By: Mia Santoromito
While Chinese zodiac may have proclaimed 2010 the year of the tiger, it appears after the latest results of RP Data’s Property Pulse, in Australia it is more likely to be remembered as the year of the million dollar property.
Results ascertained from the December quarter report showed that over 2010 the number of suburbs with a $1 million price tag nationwide grew by a whopping 35 per cent, to 212 suburbs.
This is quite a feat when you consider that in the very same year capital city home values only saw an increase of 4.7 per cent across the country.
Taking a trip down memory lane all the way back to 2005, when just 78 suburbs carried a price tag of $1 million or more, this 172 per cent rise since then certainly exposes Australia’s ever-increasing appetite for top-notch properties in prestige locations.
Indeed, according to Cameron Kusher, senior research analyst for RP Data, these results highlight not only how strong the demand for premium property is but also the lengths (and prices) Australian residents were willing to go to in 2010 in order to secure a property in a prime location.
As to whether 2011 will bear similar fruits, Mr Kusher says it is unlikely that we will see another 35 per cent increase.
“We are anticipating subdued residential property market conditions during the year and the premium sector’s performance will also be impacted by high interest rates and ongoing global economic uncertainty.
“These conditions are likely to hamper purchaser confidence and reduce the propensity of buyers to spend in excess of $1 million,” he says.
In light of this, it looks like 2011 is set to be the year of the conservative investor.
Year of the million dollar property
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