_Sydney ranked 9th for the number of super-prime sales over the past year
Knight Frank has released its latest Global Super-Prime Intelligence report which saw Sydney ranked 9th out of 12 key markets tracked globally for the number of super-prime sales – of over US$10 million – that have taken place in the city over the past 12 months.
The report found super-prime sales grew by 11% in Q1 2023 compared to the previous quarter, with 417 sales taking place across 12 key global markets tracked.
Who performed best in market?
The strongest market for sales at this level of the market in Q1 this year was Dubai with 88 sales taking place, followed by Hong Kong (67), New York (58), Los Angeles (46) and Singapore (37). London comes mid-table with 36 transactions taking place above US$10m over the period.
Over Q1 2023 Sydney had 10 super-prime settled sales of greater than US$10 million, ahead of Paris and Orange Country, both of which recorded three sales.
Over the 12 months to the end of March, Sydney recorded 76 super-prime sales, putting it in ninth place, ahead of Geneva (63), Orange County (54) and Paris (26).
The total value of Sydney super-prime sales over the 12-month period was US$1.233 billion, with an average sale price of US$16.2 million.
While volumes of super prime sales rose globally in Q1, this activity represented US$7.2 billion worth of super-prime sales, down four per cent on the previous quarter. The most expensive average super-prime sales took place in Geneva at $23.8m and London ($20.4m).
Knight Frank Head of Residential in Australia Erin van Tuil noted that over the past five years Sydney’s super-prime market had matured and as a result will increasingly attract more international buyers, which was one of the key global drivers for super-prime sales.
“In more affordable markets domestic buyers tend to dominate, while in more expensive markets the importance of international investment rises,” she said.
“Unlike the US, Singapore, and the UK, international buyers have been slower to return to Australia’s prestige residential market since borders reopened but we have seen enquiry from international buyers intensify over the past few months, and this is likely to ramp up further as we move into the spring and summer months.
“We know that the number one market for Australian ultra-high-net-worth individuals (UHNWIs) to buy in is the United States, with 59 per cent saying if they were to buy a new home outside Australia, it would most likely be in the US, according to our latest Attitudes Survey.
“While only seven per cent of UHNWIs from the US said they would buy in Australia when that survey took place, we expect this may rise moving forward, with the likelihood of more interest from countries like the US due to the value proposition with the improving currency play.
“US buyers often fly under the radar in Australia, but there is a real synergy between the west coast of the US and the east coast of Australia, and we’re starting to experience this again.
“When reviewing international ownership of prime luxury homes in Australia, US ownership comes in behind the UK and is then followed by Singapore and the Chinese Mainland,” she said.
Sydney super-prime sales exceeds Orange County, USA
Data from the Global Super-Prime Intelligence report shows that since 2020 Sydney had overtaken Orange County on the US west coast for the number of super-prime properties sold annually, while the proportion of super-prime sales being recorded in Sydney has been rising faster than when compared to LA.
Knight Frank Head of Residential Research in Australia Michelle Ciesielski said super-prime residential property has retained its attraction for wealthy buyers despite global economic headwinds, demonstrated by the increase in quarterly sales despite annual sales volumes falling from a peak of 2,298 over 2021.
“The data for the first quarter of this year confirms an ongoing desire for new $10 million-plus purchases at a time when markets were clouded by peak uncertainty around global inflation and interest rates,” she said.
“These factors are less likely to impact upon buyers of super-prime property because they tend to be cash buyers, but it does have an impact on sentiment.
“The peak in 2021 occurred during COVID lockdowns when the super wealthy were looking to buy holiday homes in lieu of being able to travel.
“Another issue holding back transactions in recent months has been limited stock availability in most markets around the globe, so this limited supply issue isn’t just happening here in Sydney.
“Our expectation is that 2023 will see more subdued conditions compared to the recent 2021 peak, with global transactions likely to total $25 to 27 billion for the full year.
“However, the recovery in growth in the global economy later this year will aid transactions in 2024, with a return to $30 billion-plus sales.”, she said.
Read the latest Global Super-Prime Intelligence Q1 2023
For further information, please contact:
Erin van Tuil
Partner, Head of Residential
erin.vantuil@au.knightfrank.com
Michelle Ciesielski
Partner, Head of Residential Research
michelle.ciesielski@au.knightfrank.com