Lagging luxury property market to get expat boost: John McGrath

Lagging luxury property market to get expat boost: John McGrath
Lagging luxury property market to get expat boost: John McGrath

Economic stability and expats pushing back into the prestige markets are helping to resuscitate the luxury residential market.

John McGrath has identified Australia’s economic performance and cashed up expatriates as two of four major themes impacting demand and prices for luxury residential property over the next 12 months.

“Political and economic stability, rising business confidence and increased overseas demand is driving new momentum in prestige property after several years of post GFC stagnation,” he says.

“While luxury property was lagging compared to the rest of the market, there are clear signals that it is stirring from its slumber and we are expecting material price rises above $2 million this year,” McGrath says.

According to RP Data figures, the number of $5 million-plus sales in Sydney was up 13% in the 2014 financial year while $3 million-plus sales in Brisbane shot up by 36%.

During the same period sales in the nation’s most expensive suburbs started to slightly outpace the lower and middle markets in price growth.

Price growth was 11% for luxury real estate while the middle market was 10.9% and the lower end 9.2%.

Expats made a return to real estate as the dollar weakened and the market became well supplied, he advised in his Swizter blog.

McGrath believes that China’s impact on property was significant after HSBC found that 18% of new supply in Sydney was purchased by Chinese investors who also claim 14% of Melbourne’s new homes.

Competition between private investors and Self Managed Super Fund (SMSF) investors was also fuelling prices.

Tags: 
John Mcgrath

Community Discussion

Be the first one to comment on this article
What would you like to say about this project?