Sydney and Melbourne’s richest and poorest postcodes revealed – and what you really need to become wealthy

Elite professionals living in Australia’s wealthiest postcode typically earn six times as much as workers in a much poorer suburb just 25km away.

The wealth gap is particularly stark in Sydney, where Double Bay’s average taxable income is $266,381 – more than doubling in just seven years in an area with a Blue Green MP.

In this part of the eastern suburbs, on Sydney Harbour, professionals in the 2028 postcode are in the top 1.5 per cent of Australian taxpayers.

They also earn more than six times as much as workers in Auburn, on the city’s west side, where $44,109 is the average taxable salary in zip code 2144 – or a level below the full-time minimum wage of $45,906.

That’s also less than half the average full-time salary in Australia of $98,218, with government benefits classified as taxable income.

Between 2014 and 2021, Double Bay’s median taxable income more than doubled from $130,873, but in Auburn the equivalent income level rose less 21.6 percent from $36,273.

During that time, Australia’s average full-time salary grew from $75,613 to $90,329 – or 19.4 percent.

In just seven years, Sydney’s wealthiest suburb grew incomes from 3.6 times what a poor suburb earned, to a multiple of six, Australian Taxation Office data shows.

Labor economics professor Mark Wooden of the Melbourne Institute of Applied Economic and Social Research said richer people also had income from investments such as real estate and high wages, leading to a widening gap between the rich and the welfare-dependent poor.

“There is a widening divide in terms of where people live,” he told Daily Mail Australia.

‘For high income earners, their portfolio is slightly more mixed.

‘For the low-income people it’s just two things: salaries and government benefits – that’s also taxable income.

“As you earn more, you try to leave your low-income area and move to a more expensive place, and of course housing is the driving force behind that – low-income areas are the places people don’t want to live.”

HAS AND HAVE NOTHING

When it comes to home values, Double Bay is significantly more expensive with a median house price of $6.726 million, compared to $1.198 million in Auburn – or 5.6 times less than mid-market homes in Sydney Harbour.

The Covid pandemic has widened the gap between the haves and the have-nots, with those who owned a home seeing a big jump in their wealth, new CoreLogic data shows.

“It probably has a lot to do with this widening gap between homeowners and non-homeowners,” Professor Wooden said.

“There’s a divide going on between those who have stuff and those who don’t.”

Between March 2020 and February 2024, property values ​​in Australia increased by 32.5 per cent, increasing the average value of an Australian home by $188,000, with house prices in particular rising.

The market peaked in April 2022, but then fell 7.5 percent as interest rates rose.

But since February 2023, house prices have risen 9.5 percent as a record high of 518,000 net immigrants over the last financial year boosted demand, despite the Reserve Bank raising interest rates 13 times in 18 months to the highest level in twelve years from 2023. 4.35 percent.

“As inventories dried up and migration boomed, house prices entered a new growth cycle in February 2023,” said Tim Lawless, CoreLogic’s research director for the Asia-Pacific region.

The population increase saw the average house price in Sydney rise 11.7 per cent to $1.396 million in the year to February.

This would buy a house in Wentworthville, where $1.368 million is the median price and where $64,599 was the median taxable income in the 2020-2021 financial year.

This was slightly below Australia’s average salary of $67,600, as of August 2023.

Prime Minister Anthony Albanese’s home suburb of Marrickville in Sydney’s inner west has an average taxable income of $79,417, with a higher proportion of middle-income suburban renters. home price of $1.996 million.

What about MELBOURNE?

In Melbourne, a similar divide exists between the richest and the poorest.

Toorak, the city’s richest postcode (3142) and the fourth richest in Australia, has an average taxable income of $222,967, putting it in the top 2.3 percent nationally.

By comparison, Broadmeadows, 33km away in Melbourne’s north, has an equivalent salary of $44,038 – or five times less.

Until 2016, zip code 3047 was the suburb where Ford manufactured the Falcon sedan and Territory SUV on the factory production line that has since been shut down.

Between 2014 and 2021, Toorak’s average taxable income increased by 33 per cent from $167,407, while Broadmeadows increased by 17.2 per cent from $37,552.

The income gap between Melbourne’s richest and poorest residents has widened from 4.5 to 5.1 – a less dramatic difference than in Sydney.

But the difference in average house prices is much wider, with Toorak having an average house price of $5.872 million – or ten times the Broadmeadows median of $568,026.

Media personality Eddie McGuire grew up in Broadmeadows but lived in Toorak when he became famous, while his older brother Frank McGuire became the Labor MP for their youth area.

Unlike Sydney, one of Melbourne’s poorest suburbs is at least affordable for an average income earner.

With a 20 percent mortgage deposit, it is possible to buy a typical home with a salary of $87,383 and take out a mortgage of $454,421 on one income – something not possible in Sydney.

The average house price of $942,779 in Melbourne has risen by just under 4.4 percent in the past year.

This would almost buy you a home in Reservoir in the city’s north end, where $958,682 is the median home price and $58,975 is the median taxable income in zip code 3073.