Market Trends of Australia Luxury Residential Real Estate Industry
Ultra High Net Worth Individuals Driving the Demand for Prime Properties
- Australia's luxury residential real estate market thrived in 2024, especially in smaller cities known for their lifestyle offerings. Reports from industry associations indicate that the population of Ultra High Net Worth Individuals (UHNWIs) in Australia is on the rise, projected to reach 27,330 by 2026. While the COVID-19 pandemic had its repercussions, most High Net Worth Individuals (HNWIs) in Australasia saw their wealth increase. In contrast, a segment of the population grappled with rising inflation and a heightened cost of living.
- Sydney currently boasts the highest concentration of UHNWIs in Australia, a status it's set to retain until at least 2026, with projections of 6,308 UHNWIs. Meanwhile, Melbourne is poised for the most substantial growth, anticipating a 34% surge, bringing its UHNWIs count to 4,968 by 2026. Following Melbourne, Brisbane is projected to have 2,449 UHNWIs, and Perth is expected to host 2,408, as per reports from Industry Associations.
- Notably, over 15,000 Australians have already crossed the UHNWI threshold, with an additional 4,000 expected to join their ranks in the next four years from 2024. In conclusion, the increasing number of UHNWIs in Australia is significantly driving the demand for luxury residential real estate, particularly in cities like Sydney and Melbourne. This trend is expected to continue, shaping the market dynamics over the next few years.
Understand The Key Trends Shaping This Market
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Sydney's Luxury Demand Surges, While Melbourne's Notable Sales Propel the Market
- According to Industry Association's Global Prime Residential Forecast, both Sydney and Melbourne ranked among the top 10 cities witnessing an uptick in luxury property price growth projections for 2024. Specifically, Sydney's luxury residential property growth forecast for 2024 was adjusted from a stagnant 0% in 2023 to a promising 3%. In contrast, Melbourne's forecast saw a shift from a slight decline of -1% in 2023 to a modest growth of 1% in 2024. These adjustments underscore the cities' stronger-than-anticipated performance throughout 2023 and into 2024.
- Sydney dominated the nation's luxury property sales in the first half of 2024, buoyed by a robust demand for high-end properties amidst a constrained supply. Meanwhile, Melbourne's Toorak emerged as the standout luxury suburb, but other areas like East Melbourne, South Yarra, Armadale, Kew, Hawthorn East, Brighton, and Portsea in the Mornington Peninsula also showcased significant activity.
- In Sydney, luxury property transactions remained vibrant across several suburbs. Notable areas included Point Piper, Bondi, Mosman, Bellevue Hill, Darling Point, Woollahra, Double Bay, Palm Beach, Centennial Park, Maroubra, Coogee, Manly, Vaucluse, and Rose Bay, all of which have seen consistent sales since the year's onset.
- In conclusion, both Sydney and Melbourne have demonstrated remarkable resilience and growth in their luxury property markets from 2023 to 2024. The upward revisions in their forecasts reflect a robust demand and limited supply, positioning these cities as key players in the global luxury real estate market.
