sydney luxury market space shrinks as prices rise in 2023
There’s plenty of room to swing a cat in Sydney, but space is shrinking year on year as prices grow. Image: Canva.
  • The least space for your million can be found in Monaco, at 16 square metres.
  • Sydney can be considered more affordable at 43 square metres per million.
  • The amount of space has dropped since last year.

One year passes and one million dollars now gets you one square metre less in Sydney, according to Knight Frank’s recently released The Wealth Report 2024.

The global luxury residential market trended in a positive direction, despite broad expectations of a weaker market. The report includes the Prime International Residential Index (PIRI 100), which climbed 3.1% on average. Tracking 100 markets across the world, 80 saw flat or positive annual price growth.

“At the start of 2023, economists were expecting a much weaker outcome across global residential property markets,” said Knight Frank’s head of international residential and country research, Kate Everett-Allen.

“Stock markets were heading for more pain, inflation was veering out of control and the pandemic-fuelled property boom was set to end in tears as borrowing costs hit 15-year highs in some markets. However, that never happened – we’ve seen a much softer landing in terms of price performance around the world.”

Does US$1M buy enough room to swing a cat?

Just enough in Monaco, with US$1 million equating to 16 square metres of luxury space in 2023.

Ranking tenth was Sydney, where that million could get you a slightly more comfortable 43 square metres; albeit that’s down from the 2022 figure of 44 square metres. The drop in space was attributed to price growth in the Sydney property market.

How many square metres of prime property does US$1M buy?

City How many square metres US$1M buys
Monaco 16
Hong Kong 22
Singapore 32
London 33
Geneva 34
New York 34
Los Angeles 38
Paris 40
Shanghai 42
Sydney 43
Miami 60
Tokyo 64
Dubai 91
Madrid 96
Mumbai 103

Source: Knight Frank.

On the second home market, Australia’s Gold Coast featured at eleventh place, delivering 112 square metres for your cool US$1 million. The space that million can get you on the Gold Coast is a little less than last year too, where a million could buy you 117 square metres.

This makes Australia one of the more affordable locations to snap up luxury property.

How many square metres of prime property does US$1M buy in second home markets?

Second home markets How many square metres US$1M buys
Aspen 20
Verbier 28
St Tropez 32
Ibiza 50
The Bahamas 62
Chamonix 63
Quinta do Lago 67
Lake Como 91
Marbella 101
Barcelona 110
Gold Coast 112
Provence 129
Barbados 143
Cape Town 196
Phuket 213

Source: Knight Frank.

Perth’s luxury property hottest in the country

The Perth property market has become the hottest in the nation, drawing buyers from around the country for its affordability, great yields, great lifestyle, and more.

Even when it comes to the luxury market, Perth came out on top.

The Western Australian capital was ranked 28th on the PIRI 100 and saw 5.2% price growth across the year, with both figures well ahead of the next Australian city tracked on the index, at equal 38th and recording a 4.1% rise in prices.

Index ranking and price growth for Australian cities

Australian city PIRI 100 rank 12 month price growth
Perth 28 5.2%
Gold Coast =38 4.1%
Sydney =49 2.7%
Brisbane 58 2.3%
Melbourne =63 1.4%

Source: Knight Frank.

Which city will be a price growth winner for 2024?

The report predicts Sydney will come out on top, with a forecast five per cent price growth for 2024; this places the harbour city fifth, globally.

Melbourne, on the other hand, is forecast to come in at eighth place, with a predicted price growth of three per cent.

Taking top spot is a city across the ditch, with Auckland’s luxury property market expected to record 10% price growth in 2024.

Scarcity remains a major influence on prices

“As wealth portfolios recovered in 2023, affluent buyers targeted residential property in the world’s luxury markets,” said global head of research at Knight Frank, Liam Bailey.

“While 24% of global UHNWIs were active in the market, inventory was down by almost a third, adding upwards pressure to prices.”

Sydney remains the apple of many high net worth (HNW) and ultra high net worth (UHNW) eyes, with Knight Frank partner, Erin van Tuil noting:

“Whilst volumes have dropped for Sydney’s prime residential market, values have not, demonstrating once again that Sydney remains a popular location to live and invest for high-net-worth individuals and ultra-high-net-worth individuals.

“Sydney also remains competitive as a global city for international investors, with US$1m buying you 10sqm more in Sydney than London, 9sqm more than in New York and 21sqm more than Hong Kong.”

Erin van Tuil, Knight Frank

“The fundamentals of the Sydney market, such as lifestyle, transparent government and taxes and the sheer beauty of living in the Harbour City are unlikely to change, and therefore Sydney’s popularity is likely set to remain.

“With only so many waterfront locations available, for an ultra-high-net-worth individual, owning a slice of Sydney Harbour real estate remains a popular investment.”

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