_Australia’s prime residential prices softening slower than the mainstream market

By nature, the Australian prime residential market records a low number of transactions each year despite the growth in wealth creation being one of the fastest, globally.

This can be due to a combination of factors including:

• A shallow number of prestige property listings at any given time
• Many owners choosing extensive renovations instead of relocating once an idyllic location is secured
• Those buying are likely to be expanding their residential portfolios for personal use or for investment, with a property not traded back into the market in return

Over the past few years, this trend has continued with upward pressure placed on property prices and multiple suburb records being achieved, despite welcoming a modest number of iconic luxury developments being built and delivered across the country.

However, since late 2021, the number of Australian prime sales transactions commenced a gradual downward trajectory to record 1.7% less than a year ago.

In turn, this has seen in the light softening of values in the third quarter of 2022, by still being 6% higher than a year ago.

This is quite a different experience to the mainstream residential market, where sales volume transactions were 10.2% lower over this same time, with values only 1.5% higher.

This demonstrates how much more this market is impacted by the multiple cash rate increases introduced by the Reserve Bank of Australia (RBA) from May 2022.

How have the prime luxury residential markets performed across Australia’s major cities?

Read the latest Australian Prime Residential Review.