Insane reveal about Aussie homes

The Australian housing market is so high the value of thousands of individual suburbs now exceed the economies of entire countries. Check out your suburb.

Explosive growth in home prices over recent years has created a tidal wave of wealth in major parts of Australia.

Alarming new research has revealed many individual capital city suburbs now have a value that exceeds Australia’s biggest companies, along with the entire economies of some nations.

Nearly 2,000 areas could be classed as billion dollar suburbs, measured by the combined value of all the homes in the area.

They included a whopping 127 areas – mostly in Sydney, Brisbane and Melbourne – where the value of all the housing stock exceeded $10 billion. This was well above the market cap of most publicly listed companies.

The country’s most “valuable suburb” Mosman boasted a mind-blowing $44.7 billion in property value – more than the market cap of global mining giant Rio Tinto.

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Housing prices have put pressure home seekers to take on more debt.

The Melbourne CBD was another of the country’s most valuable suburbs, with the 49,779 units and townhouses located there worth a total $26 billion, according to the CoreLogic valuations data.

That figure is higher than the GDP of European nations Moldova and Malta, plus a litany of African nations and Asian countries like Mongolia and Armenia.

SEE HOW MUCH EACH SUBURB IS WORTH IN:

> Sydney

> Melbourne

> Brisbane

It comes as CoreLogic last year reported the total value of the Australian property market hit an unprecedented $11 trillion.

Home values in most capitals are up more than 50 per cent on levels recorded before the pandemic.

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Sydney suburb Mosman is the nation’s most valuable suburb.

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CoreLogic director of research Tim Lawless said so much money was now locked in the housing market that a major fall in real estate values had the potential to do serious economic damage.

“If there was a (major) fall in property values, the risk for the economy and the financial sector would be significant,” Mr Lawless said.

Mr Lawless said the country’s most valuable suburbs usually had a combination of high property price points and large numbers of dwellings.

These homes often included a mix of houses and higher density apartments, with the latter often developed in the last two decades.

They were also markets that were highly sought after by home buyers – usually because of rich amenities, easy access to work hubs and good schooling.

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The Melbourne CBD was the third most valuable housing market in the country. Picture: David Caird

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“It goes further than just the individual value of homes. It comes down to how expensive and how large the suburb is,” Mr Lawless said.

“There is a real concentration of value in our capitals. This points to where people want to live and where they believe they can get a high standard of living.

“On the flip side, there are a lot of areas where there isn’t a high concentration of value and they tend to be rural markets that are far from the coast and have low levels of amenities.”

Being in one of the country’s most valuable suburbs would be a source of pride for many people – provided they could afford to live there, which many people likely couldn’t, Mr Lawless said.

“Living in a more valuable suburb will make a difference in a social sense. People do aspire to live in more desirable areas, but in a financial sense it will depend on how much debt you have.

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New Farm is Brisbane’s most valuable suburb. Picture: Brendan Radke

“Those who are in a more valuable, more expensive suburb but in debt up to their eyeballs will be in a more precarious situation.”

Ray White chief economist Nerida Conisbee said another property downturn in Australia could have far reaching impacts.

“Homeowners feel poorer and reduce spending, leading to decreased consumer activity across retail, services and discretionary purchases. This can happen with even slight declines in property values,” she said.

Ms Conisbee added that a downturn could put additional strain on banks, with residential real estate accounting for close to 60 per cent of the loan books of banks.

“(It) could trigger tighter lending standards, making it harder for businesses and individuals to get loans. This hasn’t really happened in Australia but we never really see extreme drops in value.”

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