Sydney’s luxury residential market is tipped to rise 10 per cent this year, according to Domain.
This rise will make Sydney the world’s leading city for luxury property growth, as noted in Knight Frank’s Prime Global Forecast report.
It’s a huge jump from last year’s 2021 forecast. In May last year, there was a forecast of just 1 per cent growth. In late 2020, the forecast was pushed to a meagre 3 per cent.
The report indicated closed borders encouraged wealthy Australians to purchase property in Australia, rather than overseas.
It suggested prime sales have also been boosted by expats returning to Australia.
There were 1429 prestige property sales recorded in the first quarter of this year. making it the highest quarterly figure on record for Sydney. Prime sales are defined as the top 5 per cent of the market.
In Sydney’s $20 million-and-up luxury property marketplace, there have been more than 20 sales in the first half of 2021.
This isn’t even taking into consideration the slew of settlements at the Crown’s Barangaroo tower.
The report also indicated the luxury property market may be boosted further by prospective city infrastructure, including the Circular Quay Renewal and a new Barangaroo Railway Station.
There were just 17 trophy sales of more than $20 million in all of 2020.
Internationally, the report found numerous major cities saw prime sales back to pre-pandemic levels, including Berlin, Lisbon, London, Los Angeles, Miami, Paris, Singapore, and Vancouver.
Knight Frank Australia’s head of residential research, Michelle Ciesielski, said increased demand but the same amount of supply had driven prices to skyrocket.
She explained there was an “ongoing undersupply of luxury prestige homes being built whilst our ultra-wealthy population continues to rise”.
“Many of our ultra-wealthy clients are now embracing the low interest rate environment to expand their property portfolios further, as they redirect funds into their business interests, the stock market and other investments,” Ms Ciesielski said.
“Although lockdowns are currently in place, exclusive viewings are custom when buying prestige residential property and in many instances off-market purchases were already taking place with ultra-wealthy Australians who have been grounded on home soil for the past 16 months.”