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House Price Growth Outstrips Annual Wage

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More than half of New South Wales houses have recorded price growth in excess of homeowners’ average annual incomes during the past 12 months.

It’s good news for homeowners, but less so for people looking to enter the market as nationally 95 per cent of Australian suburbs have increased in value, a third outstripping incomes, according to Domain’s data.

Among the top 20 suburbs for price increases, 13 suburbs were five times more than the annual homeowner income.

New South Wales and Victoria dominated the top 20, including lifestyle pockets such as Byron Bay.

“The premium-priced markets have led the way in house price growth, causing the biggest gap between annual house price growth and annual wages,” the report stated.

“It is this wealth effect that has underpinned the stronger-than-anticipated economic recovery prior to the current Delta outbreak.

“It’s clear there is a strong demand for space in our cities and lifestyle regions.

“This is evident in the flow of residents from our capitals and into regional lifestyle locations … as well as keyword searches placing importance on particular home amenities or luxury additions that boost our lifestyle and how we use our homes, such as a pool and study.”

Top 20 suburbs: house price growth outstripped income

StateSuburbPrice increaseDifference between price increase and annual income
NSWDover Heights$1,265,000$1,090,509
NSWBronte$1,220,000$1,066,233
NSWNorthbridge$1,050,000$857,490
NSWSeaforth$925,000$730,187
NSWMosman$875,000$729,811
NSWBellevue Hill$850,000$683,511
VICSomers$731,750$646,575
NSWManly$786,000$645,014
NSWPalm Beach$762,500$640,972
NSWByron Bay$655,000$586,090
NSWGordon$600,000$466,843
NSWKillara$612,500$466,620
NSWNaremburn$585,000$433,766
NSWAvalon Beach$545,000$421,975
VICBlairgowrie$469,500$407,998
NSWPymble$576,500$398,612
NSWNorth Balgowlah$565,000$385,443
NSWBilgola Plateau$520,000$381,892
NSWMaroubra$479,400$380,266
NSWCremorne$514,000$378,828

^Source: Domain


In Dover Heights and Bronte in NSW the difference between the increase in house prices and annual household income surpassed $1 million.

The two suburbs had an annual house price increase just over seven times and almost eight times the annual household income, respectively.

Two Victorian suburbs made the list, both on the Mornington Peninsula.

Unit owners haven’t fared as well in the annual price increases, which offers an opportunity for first homebuyers who were unable to keep pace with escalating house prices.

According to Domain data, fewer suburban median unit prices increased more than the annual income, which reflected the underperformance of the unit market nationally.

Two-thirds of apartment suburbs recorded price increases but just 10 per cent were in excess of annual income.

Queensland had the highest proportion of units in the top 20 suburbs for price increases nationally, including Sunshine Beach.

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Article originally posted at: https://www.theurbandeveloper.com/articles/house-price-growth-outstrips-annual-wage