The luxury property market in Australia has stood the test of time as well as the pandemic. The robust sector has not just remained unharmed. It has managed to surge ahead. While the global economy was in a precarious position because of the lockdown, the high-net-worth individuals continued to look for safe-havens. Being one of the least affected countries globally, Australia has been capturing the attention of the wealthy population across the world.
The local super-rich community also took advantage of international travel restrictions and has been scouting for the best prestige homes. It has helped the sector to stay ahead without any decline in the prices. Thus, if you plan to invest in luxury real estate for sale in Australia, then you should be aware of the trends to watch out for in the new year. It will help you to make an informed decision and find the best location to enjoy a comfortable life in 2021. So here are the latest developments that will take shape in the coming year.
Australian Prime Market Will March Ahead
It should not come as a surprise to potential buyers because the sector has been showing a lot of promise. According to the predictions made by one of the best real estate research agencies, the prices will continue to soar for opulent constructions in the country. The increase will be driven by the growing demand from the affluent families present down under who are looking for lavish properties loaded with all the amenities.
After the downfall of stocks during the pandemic, most ultra-rich people want to invest in tangible assets that provide them with a protected environment. With work from home being preferred by most business owners, the need for bigger and plush homes has been rising. The demand for extravagant facilities within the home has been the result of the lockdown. It offers people all the fun and enjoyment within the boundaries of their property. Thus, high-end homes have been ruling the roost.
Another reason for the growing demand is that the super-rich has not been able to spend much during 2020 and have made exceptional savings. The money that was earlier spent on international holidays and luxury brands stayed in their pockets, and now they are willing to splurge it wisely.
Government is Providing the Impetus
In November, the Reserve Bank of Australia further slashed the interest rate from 0.25% to 0.10%. It has been brought down to the lowest point to allow the economy to recover from the turbulence experienced in 2020. The cut has put a smile on the face of homebuyers and helped in boosting their confidence. Although the wealthy buyers are not dependent on the mortgage, they can now buy the A-grade properties without hesitation.
The lowest ever home loan rates have also propelled the prices along with the stimulus offered by the government. The recent growth figures have further strengthened the position of the sector as the country has recovered from the recession. The GDP displayed a rise of 3.3% in the September quarter, which reassured investors that things are getting back on track. The markets will witness further improvement once the coronavirus vaccine reaches the population of every state and territory.
Also, with remote working becoming the norm, people are not just interested in the cities. They are also looking at the suburbs which offer the same lifestyle away from the noise and gridlock. Another advantage is that suburban homes have more space, and you can find a variety of waterfront properties that are quite popular among buyers.
Sydney Will Stay on the Top
As expected, Sydney is going to be the favourite destination for homebuyers, followed by Melbourne. According to the forecast, the prices of Sydney trophy homes will rise by 3% in 2021, and the prices in Melbourne will move up by 1%. The growth in Sydney can be attributed to the rise in local demand and lowest-ever interest rates. Other reasons for the price rise are the shortage of supply and improved buyer sentiment. After the successful vaccination drive for COVID-19 begins, it is predicted that prices will go even higher as offshore investors will be coming back into the game. There will be no restrictions on travel and auctions, which will further smooth out the roadblocks.
The suburbs of Sydney are also showing an upward trend with Darling Point recording the highest median home value. Other suburbs which have been performing well include Bellevue Hill, Vaucluse, and Point Piper. Some of the recent multi-million-dollar transactions include the $16.66 million sales of a Vaucluse house and the $25 million sales in Sorrento. Another house in Bellevue was sold for $11.01 million. The most significant part of these deals was that they took place in the two major states which were worst affected by the pandemic. Also, the launch of the first phase of vaccinations will further improve the conditions.
Buyers Are Making A Beeline For The Prime Segment
The resilience of the million-dollar homes in the country has surprised all the experts and the real estate managers. Looking at the year gone by, everyone is confident that the New Year will bring further good news for the sector. The mounting demand is coming from investors who are keen on expanding their portfolio and the ex-pats who want to come back home after the unprecedented circumstances across the world.
There are several wealthy entrepreneurs who wish to put their savings into a solid sector that will stay strong during a global or local economic crisis. These individuals are also eyeing the exquisite homes that are worth millions. The prices are following the growth curve of the demand since the supply is limited. The sellers are no longer withholding the properties as they were doing during the lockdown and the sales are taking place without any delays. With more supply hitting the market, the buyers will have more choice and the prices may not touch the roof.
Buying luxury real estate for sale in Australia is the flavour of the season for the ultra-rich and it will continue in the coming year too. The market is primed for growth and the conditions are looking impressive for a positive 2021.