House hunters who do not have a seven-figure budget have already been priced out of five Melbourne suburbs.

And as house prices continue to climb, more home owners will come to grips with the idea that $1 million will not stretch far in this city.

Big-ticketed suburbs such as Toorak and Hawthorn may have the most expensive houses, but it is the city’s smallest pockets with the highest entry prices.

Last year, not a single a townhouse or house changed hands for less than $1 million in Gardenvale, Kooyong, Princes Hill, Deepdene and Warrandyte South, Domain Group data shows.

In Kooyong, a buyer paid $1.29 million in October for the cheapest townhouse sold last year; an unrenovated two-bedroom property at 6/1 Monaro Road. Number 4, a similar townhouse in the same block, sold about a year earlier for $920,000.

Marshall White’s Justin Krongold said it was a true indication of how much prices had risen for unrenovated homes in the area. He sold number 4 again — now renovated — for $1.53 million last December.

Buyers liked the easy access from Kooyong station to the city and proximity to nearby Scotch College and other private schools, Mr Krongold said. It was also now easier to bring buyers priced out of Prahran and Armadale to Kooyong.

“It used to be difficult, people thought it was a sleepy suburb, [for] a little more mature clientele, very Toorak-orientated,” he said. “Now I think younger people, professionals, are seeing value in that pocket.”

In Deepdene — sometimes classified as Balwyn —the cheapest sale was $1.15 million for a two-bedroom townhouse on Burke Road. There is a more consistent mix of higher-priced properties in the small pocket compared to suburbs such as Toorak.

Though Gardenvale may not fit the profile of a traditional prestige suburb, its smaller footprint means sales are few and far between.

There were only six house and townhouse sales last year, with the cheapest being $1,305,000 for a three-bedroom house at 90 Gardenvale Road.

Biggin and Scott Elsternwick director Bill Stavrakis said Gardenvale had a village feel, with a really quaint strip of shops and cafes on Martin Street.

The suburb offered a “really niche lifestyle” and “unique vibe” and was cheaper than Brighton and Elsternwick, he said. Gardenvale Primary and Elsternwick Primary were also drawcards.

Buyers would need a budget of between $1.1 million and $1.2 million for an entry-level townhouse on their own title, Mr Stavrakis said.

At the weekend, he sold 43 Magnolia Road to a young family, who fended off competition from four bidders, for $2.45 million. The reserve at $2.1 million, the family bought because they believe prices would continue to rise this year.

Domain Group chief economist Andrew Wilson said there were now more than 100 Melbourne suburbs with a median house price of more than $1 million — with many new entrants over recent years.

“It’s another sign of higher prices, particularly in the inner-suburban areas where you can’t get into the market at all under $1 million,” he said.

“Toorak now has a median house price just under $4 million, and that’s a 30 per cent increase over the year.”

Source: The Age