Melbourne suburbs with billion-dollar mortgage-free sales

Melbourne suburbs with billion-dollar mortgage-free sales,

Over the past financial year, billions of dollars in property were purchased mortgage-free in Melbourne’s most prestigious suburbs.

New data from PEXA Group, to be released on Tuesday, reveals that $1.05 billion was spent in Melbourne’s CBD.

This figure represents the highest dollar amount of any suburb across the state, highlighting the area’s property demand.

Additionally, the Melbourne CBD had the third-highest proportion of cash purchases, with 51.8% of transactions made without a mortgage.

The Victorian suburbs with the highest cash property sales.

Brighton and Toorak followed closely, with $735 million and $720 million spent on property, respectively.

Kew, South Yarra, Hawthorn, Glen Waverley, and Balwyn also ranked among the top 10 Victorian postcodes for cash sales.

According to PEXA chief economist Julie Toth, wealthier suburbs often see buyers less reliant on traditional mortgages.

In some cases, buyers may use family trusts, equity from other properties, or alternative financing methods for property purchases.

Toth explained that this trend reflects the high purchasing prices in these areas, driven by premium properties.

“At the very top end, buyers have access to various finance sources, which is why mortgages aren’t always involved,” she said.

The Victorian suburbs with the highest cash property purchases.

Emma Bloom, a buyers’ agent from Morrell and Koren, explained that wealthy buyers are bypassing high interest rates by purchasing with cash.

She noted that although the market is slow, it is primarily due to cautious buyers who are waiting for the right time.

“Many of these cash buyers don’t need to sell in order to buy, making them less common at the moment,” Bloom said.

In contrast, buyers who must sell before purchasing often rely on banks or family support, rather than cash.

“Those relying on banks are not typically cash buyers,” she explained. “When opportunities arise, cash buyers are often the most competitive.”

The highest proportion of cash purchases occurred in Paynesville, a seaside town in Gippsland, and Maryborough, near Bendigo.

In these towns, the percentage of mortgage-free sales was 60.1% in Paynesville and 57.4% in Maryborough, respectively.

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Toth explained that Victoria’s property market is focused on a few affordable coastal areas and select inland towns like Maryborough and Campbells Creek.

These regions typically offer lower purchase prices compared to other regional areas, attracting buyers who prefer to avoid taking out loans.

Toth added that in Paynesville, the risk of coastal inundation makes securing a mortgage more difficult, further driving cash purchases.

She also noted that cash purchases are more common in regional towns favored by retirees and areas where buyers opt for land purchases.

“The process of financing a self-build can be complex,” Toth explained. “Lenders are hesitant to finance projects without existing homes as collateral.”

Carlton had the seventh-highest proportion of cash purchases in Victoria at 49.6%, largely due to challenges securing loans for small units.

In these cases, buyers often resort to alternative financing methods, such as using equity from other properties or funding from overseas.

Harcourts Melbourne City director Dionne Wilson highlighted that cash buyers in these areas are often investors seeking a positive rental yield.

“These buyers are usually more mature, focused on retirement cash flow rather than capital growth,” Wilson said. “They prefer high-yield properties.”

Without loans, these investors can reinvest the rental revenue into additional properties, enhancing their investment portfolio.