Rising interest rates have slowed the super prime market globally, but Sydney has bucked the trend, with sales rising.
According to Knight Frank’s Global Super-Prime Intelligence Q3 2023 report, worldwide super prime ($10 million-plus) residential sales fell 2.4 per cent in the third quarter of 2023 on a year-on-year basis.
However, five markets saw volumes rise, with Sydney, Hong Kong, Dubai, Geneva, and Miami recording more sales in the third quarter compared to last year.
Sydney recorded 21 super prime sales valued at US$354 million in Q3 2023 compared to 18 at the same time last year.
The sales volume and aggregate value for super prime sales in Sydney fell, however, from Q2 2023 to
Q3 2023, with the sales volume declining from 34 to 21 and the aggregate value falling from US$686
million to US$354 million.
The sales volume in the second quarter of 2023 was the highest volume of luxury home sales for Sydney since the fourth quarter of 2021 when 56 super prime sales were recorded.
The report found Dubai once again led the ranking of quarterly sales, a position it has held since 2022, followed by London and Hong Kong.
Knight Frank Head of Residential Research Michelle Ciesielski said based on the first three quarters of the year, 2023 was on track to surpass 2022 on an annual basis for the aggregate value and total number of super-prime sales in Sydney.
“This year to the end of Q3 Sydney has seen 71 super-prime sales with no signs of slowing, while for 2022 as a whole Sydney had 108 super-prime sales,” Ms Ciesielski said.
“In addition, aggregate values for Sydney super-prime transactions to the end of Q3 this year are already sitting at US$1,300 million compared to US$1,738 million.
She said in 2023, 54 per cent of Sydney’s super-prime sales were recorded in the Eastern Suburbs, a significantly lower share than recorded a decade ago when this prime region accounted for 80 per cent of all super prime sales.
“The North Shore, meanwhile, rose from a 13 per cent share 10 years ago to 31 per cent in 2023, whilst the CBD and Inner Sydney share has seen only modest growth from 7 per cent to 8 per cent; despite several new luxury apartments built over this time,” she said.
“Overall, the total number of established super prime apartment sales across the prime regions of Sydney have increased from 13 per cent in 2013, to 17 per cent in 2023.”
Knight Frank Head of Residential Erin van Tuil said prestige homes had become a safe haven from global headwinds, with buyer demand strong in Sydney.
“Buyer appetite is strong, but existing super-prime homes continue to be tightly held and supply from new builds will always be limited given the scarcity of well-positioned sites on the harbour,” Ms Van Tuil said.
“Increasingly more apartment sales in Sydney have been reaching super-prime status over the past few years than we have seen ever before in our harbour city.”
She said In the past, it was mostly a prestige home on a large parcel of land transacting at this price point and a handful of penthouse apartments with stunning water views.
“Going forward, there will be an increasing focus by developers delivering super-prime residential projects from the ground floor to the rooftop,” Ms van Tuil said.
“Each time our ultra-wealthy population return from an overseas travel, we find a growing number seeking the ease of apartment living with exceptional amenities which allows for privacy, security and lateral living, plus a lock-up-and-leave option for their next trip.”