What $1.6m will buy you in Sydney’s luxury property market

Buyers with $1.6m to spend on a high-end home get more bang for their buck in cities bunkering down for cyclone Alfred than anything down south, a new report found.

Buyers with $1.6m to spend on a high-end home in Sydney will have to make do with a 45 sqm shoebox, but that’s more bang for your buck than in many other global cities.

Sydney is the 11th most expensive city in the world to buy luxury real estate, with the amount you can buy for US$1m falling by a third in the past decade, Knight Frank’s The Wealth Report 2025 has found.

The report found the Gold Coast has the most affordable luxury real estate in the country, with $1.6m or US$1m buying 119 sqm of prestige property, followed by Brisbane and Perth.

Sydney is the 11th most expensive city in the world to buy luxury real estate.

This is significantly more affordable than other global cities, including the world’s most expensive for luxury real estate — Monaco, where you can only buy a paltry 19 sqm for US$1m, followed by Hong Kong (22 sqm) and Singapore (32 sqm).

Knight Frank global head of research Liam Bailey said despite higher interest rates over the past four years, prime residential prices in Australian cities had largely continued to grow thanks to “cash buyers who are less dependent on financing and by lower supply”.

“While buyers of the luxury real estate are less reliant on financing, the RBA’s decision to reduce rates at their recent February meeting signals a change in the market towards greater stabilisation and a strengthening of the economy,” Mr Bailey said.

Gold Coast is the most affordable city in Australia to buy luxury real estate.

“There is now improved sentiment and further rate cuts expected this year will restore momentum.

“However, we expect a moderation of price growth in Australian luxury property markets over 2025, in line with the mainstream market, due to factors including the federal election, ongoing geopolitical uncertainty and further interest rate cuts being unlikely until the second half of the year.”

The report found Australia has the ninth highest population of high net worth individuals (HNWI) — those with more than US$10m in assets — in the world at 1.8 per cent.

Monaco is the most expensive city in the world to buy luxury real estate.

In Australasia in 2024, the number of HNWIs rose by 3.9 per cent and is expected to increase by a further 5.3 per cent by 2028.

But, we’re a long way behind the US, which is in first place with almost 39 per cent of the global US$10m+ population — nearly twice the level of China at 20 per cent.

Property plays a significant role in the wealth portfolios of young wealthy people, with real estate topping the list of luxury assets 18-to-35-year-olds would most like to own, according to the report.

McGrath Estate Agents CEO John McGrath said the next generation desired luxury real estate from a lifestyle point of view, but they could also see the strength of that asset class as an investment.

“Real estate prices in Australia are underpinned largely by an undersupply, including in the luxury market, and with the demand continuing to grow, prices will also continue to appreciate in the future,” Mr McGrath said.

“Australia is a particularly desirable market for luxury real estate due to its plentiful lifestyle locations, as well as being on the doorstep of all the global powerhouse nations within the Asian region.”

Originally published as What $1.6m will buy you in Sydney’s luxury property market