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Housing StabilityThe number of Australian suburbs with a median home price of $1 million or more surged 35 per cent in 2010, real estate researcher RP Data said, as high-end property prices defied higher interest rates.

Suburbs in the “million-dollar property club” jumped to 212 during the year, compared with 78 five years ago. Some 56 per cent of the suburbs were in Sydney, and 20 per cent in Victoria state, RP Data said.

Peppermint Grove, a western suburb of the Western Australian capital of Perth, is the nation’s most expensive area, with a median house price of $4.6 million. Resource-rich Western Australia had 12 per cent of the nation’s wealthiest suburbs.

Vaucluse in eastern Sydney was second, with the average home costing $3.8 million, while the city’s Bellevue Hill was third at $3.4 million.

Toorak topped Victoria’s suburbs, ranking eighth nationally, at $2.45 milllion, RP Data said.

“Over the past five years, the premium sector has typically fared quite well (outside of 2008) and has recorded strong growth in property values,” said Cameron Kusher, senior research analyst at RP Data. “During 2011, we would expect that there is unlikely to be a further 35 per cent increase in the number of suburbs within the $1 million club.”

Overall home price growth in 2010 slowed to 4.7 per cent in 2010 as the central bank’s seven rate increases since October 2009 took effect. The premium property market showed signs of cooling toward the end of the year with a luxury property auction at the Sydney Opera House in November selling only two of the 11 homes on offer.

Some 40 per cent more properties worth over $1 million were listed for sale in December than was the average for that time of year, the Real Estate Institute of Australia said.

“We are anticipating subdued residential property market conditions during the year and the premium sector’s performance will also likely be impacted by high interest rates and ongoing global economic uncertainty,” Kusher said.

Queensland had 6 per cent of suburbs with the median home costing more than $1 million, the Australian Capital Territory had 2 per cent and Northern Territory had 0.5 per cent.

Bloomberg News

Tags: economy, mortgage, news, property, real estate

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