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Cash purchase data reveals older Australians less likely to need a mortgage

By Juliet Helmke
13 June 2023 | 13 minute read
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New data on cash purchases in the housing market has revealed which Australians are more likely to have the funds to buy outright.

It also shows which buyers don’t – and are therefore shouldering the burden of continued rate rises.

PEXA’s new Cash Purchases Report revealed that in 2022, over one quarter of residential property transactions within Queensland, NSW and Victoria were bought outright without a mortgage attached.


The total value of residential sale settlements in the nation’s eastern states was $478.6 billion in 2022, with $122.5 billion – or 25.6 per cent – cash-funded.

The report provides information on the source of funds used to settle property and analysis of the regions, property types and price points where purchases without a home loan were most common.

The locations where the vast majority of these homes were bought were in areas favoured by older Australians – regional towns where property is more affordable.

PEXA’s head of Research, Mike Gill, commented that the data around cash purchases can shine a light on important aspects of buyer behaviour.

“Given these transactions represent more than a quarter of all residential property purchases, it is important to consider that this is a sizeable cohort of buyers who are less impacted by rising interest rates, having not taken out a loan,” Mr Gill said.

“Our research found cash buyers tended to be older and more likely to be buying in regional locations, which does highlight the generational divide between borrowers. Younger home owners are more likely to have larger home loan balances, particularly those who have purchased recently, whilst many older home owners are likely to have paid their home loan off or be able to pay cash for a home to retire in,” he elucidated.

Ultimately, he said the figures should also call attention to the buyers who are not buying in cash and bearing the brunt of increasing mortgage rates.

“Therefore, as the RBA raises interest rates to slow the economy and fight inflation, the burden falls more toward younger Australians who are more sensitive to rising rates and less so on older generations who may in fact benefit if they have savings,” he said.

On a granular level, the report highlights some of the towns across the eastern seaborn that are most likely to have cash-ready buyers looking to invest.

The postcodes shared a number of factors – higher median ages, lower labour force participation, and a majority of the households composed of couples cohabitating without children.

The median prices for cash purchases in these postcodes are significantly lower than state averages. The locales are also home to lower-than-average family incomes due to the high proportion of retirees.

The top three postcodes for cash purchases by percentage in Queensland were Tara, in the Western Downs (78.4 per cent), Russell Island off the coast of Brisbane, (76.4 per cent) and Gin Gin, in the Bundaberg region (71.9 per cent).

In NSW, New England’s Emmaville was the most popular for cash purchases (73.3 per cent), followed by Gloucester on the Barrington Coast, (65.2 per cent), and Woombah near Bundjalung National Park, (62.5 per cent).

Meanwhile in Victoria, Gippsland’s communities caught the eye of cash buyers with Yarram (57.5 per cent), Paynesville (57.1 per cent), and Metung 3904 (56.9 per cent) the most popular.

But in terms of total amount of money spent in a given postcode, wealth was concentrated in urban areas. In that ranking, Broadbeach came out far ahead of the rest, with $1.33 billion spent on cash purchases in 2022.


Juliet Helmke

Based in Sydney, Juliet Helmke has a broad range of reporting and editorial experience across the areas of business, technology, entertainment and the arts. She was formerly Senior Editor at The New York Observer.

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