Aussies swarm high-end property market, triggering price growth
Prices across the high-end property market are tipped to see exponential growth as demand for space and comfort increases.
Knight Frank’s latest wealth report has predicted strong demand for luxury property to continue across the country, with growth of 3 per cent predicted across Perth, Gold Coast and Sydney. Brisbane and Melbourne too are expected to benefit from this new trend, with increases of 2 and 1 per cent, respectively.
According to research head Michelle Ciesielski, with the ultra-wealthy population in Australia increasing over the past year, much of this wealth will be redirected back into expanding property portfolios over the coming year.
“It’s likely we’ll see more second homes in coastal or rural settings being purchased with better connections to the primary residence, and as we saw in 2020, the birth of the co-primary home with a priority for faster broadband capabilities,” Ms Ciesielski said.
She noted that lifestyle, wellness and wellbeing will be among the primary priorities for primary property buyers in Australia, with many aiming for more green space and luxury amenities.
In 2020, five Australian cities made the Prime International Residential Index (PIRI 100) ranking within the top 65 in prime residential market performance. Perth led the group in 34 position, with Gold Coast coming in 36th, Brisbane 44th, Sydney 56th and and Melbourne 65th.
PIRI 100 tracks the movement of luxury residential prices across the world’s top 100 residential markets.
Growth drivers
Looking ahead, Knight Frank predicted that 16 per cent of Australia’s ultra-high-net-worth will be buying property in 2021.
“On average, 22 per cent of the wealth of Australian ultra-high-net-worth individuals is directly
allocated to property for their principal and second homes where they and their families spend time, while on average 24 per cent is directly allocated to a property investment portfolio,” said Shayne Harris, national head of residential at Knight Frank.
According to Mr Harris, Australia’s ultra-wealthy are most likely to buy a new home locally, followed by purchasing a second home in the US, New Zealand, the UK, then Israel, while ultra-high-net-worths from overseas list Australia as a number three destination behind the UK and the US.
“The attributes listed as most important for Australian ultra-high-net-worths purchasing a new home in 2021 include outdoor space and leisure facilities or amenities.”
As such, Sydney’s super-prime property market – those sales exceeding $10 million – is tipped to drive up Australia’s overall prime performance as ultra-wealthy individuals look to upgrade the family’s main residence and buy new holiday homes, with international travel likely to remain subdued in the coming years.
More from this writer:
-
Why it’s still worth selling – even in lockdown
-
Over 200 Perth suburbs see winter price growth
-
Auction volumes on their way back up
-
Low interest rates drive record refinancing
-
Tassie’s own $20k HomeBuilder grant finds early success
-
Capital cities see stronger auction success
-
2020 vs 2021: How lockdowns have impacted the market