Will the market be able to sustain million-dollar property sales this year?

By Gerv Tacadena

The proportion of million-dollar home sales in the overall residential property sales was on the rise.

2017 was a good year for residential property sales, as 16.1% of all houses and 9.5% of all units sold nationally had were transacted with overall prices exceeding $1m, per CoreLogic. More houses and units sold for more than $1m than sold for less than $200,000.

Across all capital cities, 23.8% of all houses and 11.6% of all units were million worth. Five years ago, only 9.8% of houses and 3.9% of all units had the $1m price tag.

The highest proportion of such transactions was in Sydney. Over the year, almost half (49.35%) of all houses were worth a million. However, with values beginning to decline in the city, there is a high possibility that the proportion of sales worth at least one million will start to thin.

Meanwhile, the share of million-dollar sales in Melbourne has climbed significantly over the past five years. In 2017, 28.3% of all houses and 8.3% of all units had been transacted for at least $1m, up from 9.7% houses and 3.5% units in 2012.

Canberra also saw an increase in the number of million-dollar homes sold, up 12.6% of all the houses in the year.

In Adelaide, while dwelling values only increased by a measly 2.2% over the past year, the share of million-dollar home transactions climbed steadily at 5.5% of all houses.

Even in Hobart, considered to be the most affordable capital city, the share of million-dollar houses has seen a significant lift, up to 2.8% from 2.3%.

The story was different in Perth, where the share of such transactions has fallen over a year for houses (10.4% to 10.3%) and units (4.5% to 3.2%). Darwin, the nation's weakest performing capital city also saw the proportion of million-dollar houses fall from 4.1% to 3.1%.

The question now remains whether Australia will be able to sustain the growth in the proportion of million-dollar homes sold given that the prices are now spiralling down.

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