How much you need to earn to be rich in Australia as country sees a rise in the ultra wealthy

More Aussies are reaching mega rich status, despite the pandemic leading the country into the recession for the first time in 30 years.

Aussies wanting to rank in the top 1 per cent of the population by wealth require $US2.8 ($A3.5 million) to qualify.

But for those wanting to aim a little lower, there are an estimated 44 Australian billionaires and almost 177,000 millionaires, with the majority based in Sydney, according to a global report from real estate agents Knight Frank.

When it comes to the ultra wealthy who have at least $US30 million ($A38 million) to their name there are almost 3200 Aussies that qualify – a figure that jumped by 10 per cent last year.

This jump – which was four and a half times more than the rest of the world – was attributed to expats returning home, the share market bouncing back and low interest rates encouraging business investment.

Michelle Ciesielski, Knight Frank’s head of residential research, said Australia had continued to see solid growth in its ultra-wealthy population in 2020, despite the pandemic leading Australia into a recession for the first time in nearly 30 years.

“The Australian government has handled the pandemic rather well by propping up the economy, so wealth has remained relatively unchanged for many, and with closed international borders, much of this wealth has been reinvested locally,” she said.

“According to the Knight Frank Attitudes Survey conducted in the last quarter of 2020, 43 per cent of the Australian ultra-high-net-worth population in Australia reported that their source of wealth was their own business, while 30 per cent reported it came from an investment portfolio.”

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Stuck in Australia due to border closures, the rich have turned to splashing their cash on luxury homes. Picture: iStock

Luxury homes in Australia also saw a boom last year. Shayne Harris, national head of residential for Knight Frank said demand for luxury property in Australia would continue to be strong, boosted by the ongoing pandemic and the continuing return of expats.

“The pandemic has forced many to retreat in the comfort of their home for the best part of 2020, so it’s not surprising prime property is becoming increasingly more attractive in destinations known for their lifestyles such as Perth, the Gold Coast and Brisbane,” he said.

“In Sydney, it’s the super-prime property market – those sales exceeding $A10 million – which is driving up the overall prime performance as we see our ultra-wealthy clients upgrading the family’s main residence and buying new holiday homes as international travel is likely to remain subdued in the coming years.”

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The safe haven from the pandemic saw Australians increase their wealth in 2020. Picture: iStock

Knight Frank’s The Wealth Report 2021 found that Sydney accommodates approximately 27,500 prime luxury homes, which is just under half of those estimated in London, but three times more than Singapore.

But Ms Ciesielski said globally values for prime property in Australia weakened over 2020 as a result of the strengthening Australian dollar.

“This resulted in the value for money being reduced, with $US1 million ($A1.3 million) buying fewer square metres in each city than one year ago,” she said.

“This amount of money goes the furthest on the Gold Coast, where you can buy 126sq m of luxury internal floor space, but it will buy you the least in Sydney, where you can get 45sq m.

“In saying this, $US1 million ($A1.3 million) in Sydney bought more than double what you could in both Monaco and Hong Kong at the end of 2020.”

Shopping for high end handbags topped the list for ways the rich spent their money. Picture: iStock

Aside from housing, the top collectable luxury items for the ultra rich were a Hermes handbag, wine and cars, added the report.

But it warned that Australian’s jump in wealth could stagnate while borders remain closed, although by 2025, there are expected to be 3760 ultra wealthy Australians and 215,000 millionaires.

Ultra-wealthy Australians see technological disruption as an opportunity but are worried about ongoing disruptions from COVID-19 and trade wars, the report also found.