- Perth luxury market set to grow further 6%, following 10.5% growth in 2021
- City was named 31st strongest luxury market, becoming more popular with the world's wealthiest
- Applecross considered a standout suburb by Knight Frank, growing exponentially in prime sales over the past decade
Perth’s luxury residential market is poised for further growth over the next year, after ranking 31st on the Prime International Residential Index in 2021.
The coveted international ranking was revealed in Knight Frank‘s The Wealth Report 2022, which analyses prestige markets around the globe.
Perth only fell behind Sydney and Brisbane, which ranked 17th and 29th respectively, topping Melbourne which came in at 39.
Perth transforming into wealth magnet
According to Knight Frank, Perth luxury prices grew 10.5% last year and are forecasted for a further 6% in 2022.
Mack Hall, of Mack Hall Real Estate, said the prestige market in Perth has been strengthening in recent years, still with room to grow.
“If you look at how the city’s luxury market compares to other Australian cities, it’s evident that it is really only just gearing up, with big scope for further growth in the future.”
Mack Hall, Mack Hall Real Estate
Mr Hall attributed growth opportunities to the reopening of the borders, and said greater arrivals of interstate and overseas investors would drive greater demand for luxury residential property.
The number of ultra-high-net-worth individuals in Perth has risen dramatically in recent times, up 10.5% in 2021. By 2026, this number is expected to grow to 2,408 individuals, equating to a further 23% growth.
Perth’s ranking on the City Wealth Index, which ranks the cities that are most valued by the wealthy, has also seen improvement. The ‘City of Lights’ was ranked 74th in 2021, climbing its way up 7 spot to 67th in 2022.
“The wealthy are attracted to Perth due to the city’s relative affordability to east coast cities, especially for living near the water, as well as outstanding lifestyle, including its balmy climate,” said Mr Hall.
Knight Frank’s Head of Residential Asia Pacific, Victoria Garrett, said Perth has caught the interest of wealthy South-East Asian individuals in particular due to the city’s proximity and have welcomed the state’s reopening.
“[South-East Asians] find the prime luxury price point attractive over other Australian cities, and it’s a short flight home and within the same time zone, making it easier to do business.”
Victoria Garrett, Knight Frank
Ms Garrett added that Australia’s foreign investment framework has restricted international clients to only purchasing new homes, reducing the purchase pool significantly for buyers.
“With more apartment projects earmarked with high-end luxury amenities, this will be attractive not only to international buyers but those domiciled in Perth as travel is again on the agenda – and they can easily lock-up-and-leave.”
Sales looking peachy for Applecross
One suburb flagged by Knight Frank as set to capitalise on the strong luxury market in Perth is Applecross, bound by the Swan River.
The suburb was named a prime residential hotspot by Knight Frank in 2019, and has seen prime property values grow by 12.2% in the year to March 2022.
“Applecross attracts both local and international families, drawn to its combination of proximity to Perth’s urban action and quiet suburban allure,” said Mr Hall.
Applecross recorded 33 prime sales last year, averaging at $3.68 million per property, more than 10 times the amount of sales seen in 2011.
“This affluent suburb will continue to be highly sought after by buyers.
“Not only is it close to the CBD, with good connectivity to three world-class universities, top private schools and other amenities including shopping centres, but it is picturesque,” Mr Hall concluded.