In this edition of our Month in Review, we look at the lazy million. In previous years we have deep-dived into the lazy $750,000, but by necessity, we’re stepping it up a notch.
Driven by relentless population growth and a structural undersupply of housing across much of Australia, a seven-figure budget has rapidly shifted from a luxury purchase to the new baseline for standard family homes in most of our major capital cities.
Despite recent interest rate hikes, Australia’s major capitals are moving at vastly different speeds:
Sydney: A distinct two-speed market has emerged. While the top 25 per cent of properties saw a 2.7 per cent drop in the three months to April, the affordable lower quartile rose 1.5 per cent, propped up by government deposit schemes. A million dollars here buys a house on the distant outskirts or a secondary location — pushing smart money into resilient inner-ring units.
Melbourne: The sub-$950,000 market remains competitive, with first homebuyers and budget-conscious purchasers actively competing in the lower-value brackets, whilst several suburbs that traditionally sat around the $1 million mark have been demoted to below it.
Brisbane: While broad market demand has softened slightly, the appetite for attached townhouses and units on the edge of the inner ring remains exceptionally strong, with solid capital growth expected.
Perth: Once a high-end budget, $1 million is now the standard benchmark for a metropolitan family home, or merely the entry point for a unit in a prime, blue-chip location.
For investors, navigating the current market means managing significant macro headwinds. Adding to the complexity, the recent announcement in the federal budget of proposed changes to negative gearing and capital gains tax are sure to dent consumer confidence, but after years of chronic undersupply in many markets, what will the real damage be? While these reforms will likely dampen near-term investor enthusiasm, above-average immigration and a stubborn failure to hit dwelling construction targets mean price impacts are likely to be targeted to specific products in specific locations.
Ultimately, parking a lazy million today isn’t necessarily about buying a trophy asset outright; it’s a strategic game of choosing between Sydney’s resilient lower-tier units, Brisbane’s high-demand inner fringes, Perth’s tightly held family footprint or maybe what is starting to look like value for money in Melbourne.
Outside of the capitals, $1 million may sound like a big number in many of our more remote regional centres, but our analysis shows a mixed bag of some absolute bargain areas where a rock star house remains attainable, to those towns where the secret is out, and the money has already poured in.
What you can be sure of is that there is something for everyone, as our team brings to you a plethora of examples of what a lazy $1 million can buy you around Australia.