While the world is grappling with the COVID-19 pandemic, the spirit of affluent homebuyers has not dampened a bit. Standing tall among all the nations, Australian cities have managed to secure top ranks for showcasing growth in the luxury property segment. Bagging five spots in the list of 45 top-performing luxury real estate growth markets, we have established our supremacy. It is the perfect time to invest in luxury property for sale in Australia as the prestige market is outpacing all other segments.
The top contenders are unsurprisingly the highly sought-after destinations of Sydney, Gold Coast, Perth, Brisbane, and Melbourne. The cities have displayed increased activity in transactions in the million-dollar property segment in the last one year. Despite challenging times, the sector has been booming and has showcased its resilience. Here is what is making these cities the top performers.
Exceptional Performance of the Top Cities
As expected, Sydney bagged the highest ranking at 16th position followed by Perth at 17th and Gold Coast at the 18th position. Brisbane and Melbourne were not far behind at 23rd and 26th position, respectively. The global index report for the third quarter of 2020 ranked the cities according to the annual percentage change displayed in a year. The capital city of New South Wales exhibited a price growth of 2.3%, Perth demonstrated a 2.2% jump, and Gold Coast experienced a 1.8% leap. Brisbane performed well with 1.1% growth followed by the lockdown affected Melbourne, which registered a 0.3% hike.
The post lockdown period has been significantly eventful for the sector as high-end buyers are keener on investing in premium properties. Many people are viewing these trophy homes as a luxury retreat, which can be used as a second family home or holiday home during a pandemic-like crisis. The growth in the market is estimated to continue until the end of the year as the economies of the cities are coming back on track with ease in restrictions related to COVID-19.
The confidence of the buyers was further strengthened by the upward trend in the stock market and low-interest rates. Also, the lockdown did not allow the ultra-rich population to spend too much on other luxuries like international travel and designer labels. Many of them were able to save a fair amount that is now being invested in a high returns’ asset.
Higher Demand from Local Buyers
The report which surveyed cities across the globe ranked Auckland in the first position followed by Manila in the second. The common factors that were shared by the top rankers were their safe environs during the current conditions and economic stability. It is evident that most of the demand came from home as international travel restrictions have been in place in most parts of the world. Since there is no shortage of super-wealthy population in Australia, it is apparent why so many cities surfaced on the list.
Also, the high standard of living and commercial opportunities in these locations are at par with any other developed nation.
Sydneysiders have been focussing on the most expensive homes in the city to make the most of their time while being indoors. The surge in demand is clearly visible in mansions that are worth $7 million or above and offer the exclusivity of being positioned in a suburb. In September, a prime property was sold for $24.6 million in Vaucluse. The baffling part of the transaction was that its selling price was $10.6 million above its reserve price. It is now the most expensive residential property ever sold at an auction in the country.
Beachfront and Country Homes Are the New Favourites
The suburbs of Sydney, Melbourne, Gold Coast, Brisbane, and Perth are also witnessing a new boom. More investors are planning to move into big houses with various private amenities, such as an indoor swimming pool, vast garden, terrace, walk-in wardrobes, modern kitchens, etc. Such big properties are generally available in the suburbs and offer safety from the current health crisis, which is gripping the capital cities. Many Melbourne residents are looking for prestige homes in Gold Coast and Perth to get away from the lockdown and other restrictions.
Regions that have been making all the noise in the third quarter include Byron Bay, Hunter Valley, Bendigo, Toorak, Noosa, etc. The regional towns which were not affected by the COVID-19 pandemic are getting all the attention from homebuyers, and thus prices are rising in these areas. These are also offering a lower price bracket than the capital cities and have all the creature comforts that luxury property needs.
Ultra-Wealthy Buyers Are Boosting the Growth
The wealthy homebuyers have not been affected by the reduction in loan to value ratio by some of the biggest banks for self-employed clients. They often require a small mortgage or pay upfront in cash, which has made them look for the best spots in the country without any hassles.
The drop in the number of listings due to the lockdown helped in improving the prices in Perth. Also, the limited supply of stock in Western Australia helped in improving the growth rate with the help of high demand. Buyers are fiercely competing during the auctions, and it is pushing the prices higher than expected. Numerous expats living in countries like the US and UK are also making a beeline for properties in Perth as they want to stay away from the big cities during the pandemic.
In line with the trend, one of Gold Coast’s beachfront property was sold for $25 million as the love for serene surroundings is attracting the high-end buyers. A plethora of owners of opulent and grand homes, however, are not planning to sell in the circumstances, and this has led to a shortage of listings which is creating the price rise. Thus, the buyers are going all out to find the best deluxe residences in the country and are willing to pay an increased price for it.
The price growth of the five Australian cities has been buoyed by the strong demand and restricted supply in the market. Thus, luxury real estate for sale in Australia has become the hot favourite of affluent buyers looking for a safe haven in the pandemic ridden world.