The top Australian suburbs on the east coast where buyers are paying for property in cash
Cash buyers are changing the residential property buying landscape as three in 10 homes sell without a mortgage in 2023
2 min
Almost three in 10 homes purchased on the East Coast last year were bought with cash, contributing to the historically unusual situation of growing home values alongside rising interest rates. The demographics of cash buyers include high income earners buying in blue-ribbon city suburbs, downsizers in all locations, retirees purchasing in seachange and treechange areas and local and overseas investors buying inner city apartments.
Digital property exchange platform PEXA has released its 2023 Cash Purchases Report covering residential property settlements across New South Wales, Victoria and Queensland. The proportion of cash-funded purchases increased by 1.5 percent in 2023 and totalled$129.6 billion. In 2022, cash sales totalled $127.7 billion. Cash buys accounted for 28.5percent of all residential settlements last year, up from 25.6 percent in 2022.
NSW recorded the highest total value of cash purchases at $54.9 billion and 27.7 percent of purchases. QLD cash purchases totalled $39.4 billion and 29.6 percent of purchases, and Victoria cash buys were worth $35.3 billion and represented 25.2 percent.
PEXA’s chief economist Julie Toth said: “Cash-buyers are changing the dynamics of the residential property market and exerting a greater influence on overall property demand. The relatively large size of this group helps to explain the property market’s resilience in 2023, despite rapid rises in interest rates.
“Our research found the demographic profile of cash buyers is different to mortgage buyers – cash buyers tend to be older and more likely to be retired. They tend to have lower household incomes, but they also have fewer dependents and are more likely to be ‘asset-rich’, with accumulated property, savings and superannuation to fund their next purchase. If they have interest-earning savings, then they may even have benefited from rising interest rates,” she said.
The report found regional buyers form the largest cohort of the growing cash-buyer market, followed by inner city buyers. “Regional cash property purchases are likely being driven by retirees and downsizers looking for a ‘tree change’ or ‘sea change’ which has become a popular trend in recent years,” Ms Toth said.
The largest proportion of cash purchases across the East Coast was in regional Queensland, with 33,055 homes bought without a loan. Renowned retirement destinations such as Surfers Paradise, Broadbeach, Hope Island and Port Douglas were among the most popular locations with cash buyers.
“In contrast, the inner-urban cash buyers are likely a combination of affluent owner-occupiers who are relocating, plus domestic and international investors buying rental properties,” Ms Toth said. Melbourne and Sydney are among the postcodes with the highest total value of cash buys, likely reflecting a large proportion of local and overseas investors buying apartments.
Top 10 postcodes by value of cash buys
QLD 4217 Surfers Paradise $1.43 billion
NSW 3000 Melbourne $1.32 billion
QLD 4218 Broadbeach $1.2 billion
NSW 2765 Marsden Park $971.9 million
NSW 2088 Mosman $944.2 million
NSW 2065 St Leonards $789.3 million
QLD 4551 Caloundra $737.5 million
QLD 4212 Hope Island $710.9 million
NSW 2000 Sydney $709.2 million
NSW 2027 Darling Point $703.3 million
Top 10 postcodes by proportion of cash buys
QLD 4421 Tara 86% (median price $82,500)
QLD 4184 Russell Island 76% (median price $85,000)
QLD 4671 Gin Gin 72.3% (median price $275,000)
QLD 4819 Magnetic Island 68.2% (median price $365,001)
QLD 4877 Port Douglas 66.4% (median price $445,000)
QLD 4615 Nanango 65.0% (median price $292,500)
NSW 2422 Gloucester 63.9% (median price $530,000)
QLD 4852 Mission Beach 60.9% (median price $307,500)
QLD 4850 Ingham 60.7% (median price $188,500)
QLD 4660 Childers 59.6% (median price $385,000)
Rising rates, construction inflation and shrinking investor confidence are pushing Australia deeper into a dangerous housing spiral that monetary policy alone cannot fix.
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Rising rates, construction inflation and shrinking investor confidence are pushing Australia deeper into a dangerous housing spiral that monetary policy alone cannot fix.
2 minThe Reserve Bank had little choice but to raise interest rates again this week.
Inflation was already proving stubborn before the latest Middle East instability added further pressure to energy prices and supply chains.
Housing inflation alone has averaged six per cent over the past year, remaining one of the single biggest contributors to CPI.
But while the focus remains on rates, the deeper problem is structural and far more dangerous.
Australia is not building enough homes, and the conditions required to fix that are deteriorating simultaneously.
Construction costs remain elevated. Builders are increasingly unwilling to absorb contract risk. Labour shortages persist.
Capital is becoming more expensive. And as borrowing capacity weakens and sentiment softens, fewer projects are becoming financially viable.
The result is a self-reinforcing cycle.
The RBA raises rates to fight inflation. Higher rates reduce development feasibility. Fewer projects start. Housing supply tightens further. Rents rise. Inflation persists. The RBA raises rates again.
The only long-term solution is supply, yet Australia remains nowhere near the National Housing Accord target of 240,000 new dwellings a year.
Completion continues to lag approvals, meaning many projects approved on paper are simply never making it out of the ground.
That gap matters enormously because housing is not just another sector of the economy.
Around two-thirds of Australian household wealth is tied to property, while the sector underpins millions of jobs and related industries. Weakness here quickly spreads beyond real estate.
We are already seeing signs of stress. Auction clearance rates in Sydney and Melbourne have softened, borrowing capacity has declined, and parts of the market are experiencing price corrections as confidence weakens.
At the same time, policymakers continue to debate tax measures such as changes to negative gearing and capital gains tax discounts, despite fears that such reforms could drive private capital out of the rental market at precisely the moment when supply is most constrained.
This is the paradox at the centre of Australia’s housing crisis.
Demand for property remains extraordinarily high, yet the economic conditions required to actually build new housing are worsening.
The Reserve Bank cannot solve that problem alone.
Monetary policy cannot accelerate planning approvals, reduce construction costs or create more tradies. It can only raise the cost of money until something eventually breaks.
And increasingly, that “something” looks like the development pipeline itself.
Paul Miron is the Co-Founder & Fund Manager of Msquared Capital.
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