Luxury market set to boom further in 2025
With Australia’s luxury housing market forecast to reach or exceed $2 million over the coming year, some smaller capital cities are emerging as luxury housing hotspots.
The 2025 Property Outlook Report has forecast a “shake-up” in the Australian luxury property market, with new states as forerunners for investors.
Ray White senior data analyst, Atom Go Tian, said Australia’s luxury property markets are seeing their most “dramatic realignment” in years.
“With traditional hierarchies being challenged, new players [are] climbing to the fore,” Tian said.
In the report, luxury houses refer to housing priced in the top 5 per cent of the market in each region.
Despite showing the slowest growth, Sydney still has a major lead on other markets, sitting above $4 million across its top 5 per cent with a nearly 26 per cent increase over the past five years.
“Sydney maintains its long-held position as Australia’s most expensive luxury housing market, though the story is far from dynamic,” Tian said.
“Perhaps the most compelling development is occurring in regional Queensland’s coastal markets.”
The 2025 Property Outlook Report noted that the Gold Coast has finally taken over Melbourne as the second most expensive premium property market, with a 50 per cent growth over the past five years and houses reaching $2.54 million.
Tian said the Sunshine Coast followed suit, with over 48 per cent price increase in the last five years for the current top 5 per cent house price to reach $2.37 million.
“The Sunshine Coast is projected to join Sydney and the Gold Coast in the top three within the next 12 months,” Tian noted.
Brisbane luxury market has also increased over the last five years, seeing a 50.5 per cent growth to exceed the $2 million mark.
In comparison, Tian said Melbourne saw a “sluggish” 9.75 per cent five-year growth rate, with the top 5 per cent premium property in the capital city priced at $2.51 million.
Despite slow growth, Melbourne is the third most expensive city for luxury properties.
Nationwide, Perth and Adelaide have shown over 50 per cent growth, while Canberra remained below 25 per cent growth over the past five years.
Tian noted that Perth has now exceeded the $2 million mark for houses in the top 5 per cent, driven by a five-year growth rate of 53 per cent, while Adelaide is nearing the $2 million mark.
“Adelaide, despite currently sitting at $1.8 million, shows the strongest momentum of all capitals with a 56 per cent five-year growth rate, suggesting it may soon push Canberra to eighth place.”
Tian said that Canberra, “once a strong performer”, has now dropped from fourth to seventh place in just five years, with its luxury house prices stagnating at $1.95 million.
“Looking ahead, the market appears to be trending towards a new baseline, with all major cities except Darwin expected to reach or exceed the $2 million mark for luxury properties,” Tian said.