Home values in some of Australia’s most exclusive suburbs are set to rise further as billions of dollars worth of renovations are planned. In June alone, renovation approvals hit a record $1.17 billion, with $12.8 billion approved over the past financial year.

Wealthy homeowners, particularly in Sydney and Melbourne, are driving this building boom. “More expensive suburbs reflect desirability, large land sizes, and prime locations, which all make large investments in homes worthwhile,” said PropTrack senior economist Paul Ryan. High stamp duty costs also encourage homeowners to renovate rather than move.

Top renovation hotspots include Point Nepean in Victoria, where $97.5 million worth of renovations were approved, and Sydney’s Manly and Fairlight, which saw $88.5 million in renovations. Real estate agents note that many homeowners are investing heavily in making their current homes their “forever” residences. The renovation boom is expected to continue, supported by easing construction costs and recent strong home price growth, which is giving homeowners the equity needed to fund these projects.