Sydney and Melbourne no longer ranked highest for luxury properties

A new report indicates Brisbane, Gold Coast, and Perth for highest luxury home price growth 

16 percent of ultra-high-net-worth Australians plan to buy a new home this year. DAEPhoto/Shutterstock

As people hunt for homes that double up as “COVID-free castles”, prestige property prices in Brisbane, the Gold Coast, and Perth have surged, with a new report indicating that the three cities have outrun Australia’s two biggest capital during 2020, reported Domain 

The recently released Knight Frank Wealth Report 2021 also unveiled the trio made a global splash in the Prime International Residential Index (PIRI 100), which follows the fluctuations of luxury home prices across the world’s 100 best residential markets.  

The three cities, with Perth coming first, were ranked in the top 44 of prestige markets on the basis of surging buyer demand, greater emphasis on lifestyle, and low-interest rates, clocking up annual price growth of more than 2.5 percent. 

Sydney ranked 56th after luxury home prices rose just 1.1 percent, while Melbourne ranked 63rd with a 0.9 percent increase. 

On the other hand, Perth ranked 34th as prices soared by 3.6 percent last year. The Gold Coast came in at 36 after prices grew by 3.2 percent, and Brisbane in 44th place with 2.5 percent growth.  

Michelle Ciesielski, head of Knight Frank’s residential research Australia, said the pandemic have encouraged high-end homebuyers towards smaller cities that offered better lifestyle and value.  

“During the pandemic, people reassessed their priorities…it made us reevaluate how we want to live over the long-term,” Ciesielski said. “COVID-19 was [also] handled well in Australia, with a brief lockdown in all cities except for Melbourne, and when our cities were opened up, we saw a surge in pent-up demand, particularly as homeowners re-evaluated their lifestyles.” 

Increased remote working and shift in property priorities also boosted growth in smaller cities, as wealthy buyers from Melbourne and Sydney realised a better bang for their buck in Western Australia and Queensland.

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Ciesielski added, “before COVID-19, people wanted to live close to where they worked, but since then that’s changed…grounded by travel bans, Australia’s luxury buyers [also] focused on building their property portfolios at home, buoyed in part by the country’s bullish stock market and historically low-interest-rate environment.”  

Knight Frank conducted an Attitude Survey as part of the report and found that 16 percent of ultra-high-net-worth Australians plan to buy a new home this year, with outdoor space and leisure facilities or amenities listed as top priorities.  

Survey data also showed 58 percent of buyers were searching for homes in resort coastal areas.