Luxury property market sees off Covid-19
Luxury property prices are almost on par with pre-COVID-19 levels as the top end of the market accelerates to accommodate demand.
Luxury property prices are almost on par with pre-COVID-19 levels as the top end of the market accelerates to accommodate demand from expats and cashed-up upgraders.
Between March and September last year, the upper quarter of Australia’s property market across the combined capital cities fell by 4.3 per cent while lower quartile values were virtually unchanged.
The market momentum in the premium sector has surged, with the top end now outpacing lower value properties. Capital city values are now almost back to the levels of February 2020, up 4.1 per cent in the past three months, compared with a 3.2 per cent rise across the lower quartile.
CoreLogic head of residential research Eliza Owen said the housing market was “up to its old tricks”, with the volatile top of the market accelerating in the upswing.
“During upswings, we see the high end of the market tends to have higher growth rates,” Ms Owen said.
“It does also tend to cop more of a loss during downturns as well, it’s just more volatile in that way.
“In 2020, we saw the low end of the market was very popular because first-time buyers were becoming more prominent, obviously, that lower tier is more affordable.
“But now as the economy swiftly recovered, investors returning to the market, the high end is sort of following those historic cyclic patterns.”
Sydney’s top end is outpacing the other capitals, up 4.5 per cent in the past three months. Perth and Hobart are each up 4.4 per cent, while Brisbane has increased by 3.9 per cent.
Sydney real estate agent Dino Gatti, of The Agency — Lower North Shore, sold one of two identical townhouses in Neutral Bay last September for $4.85m after a three-month campaign to expats.
He is taking the second townhouse to auction this month with a price guide of $5.3m. “The pulse of the market is running high at the moment,” Mr Gatti said.
“The biggest questions we were getting asked six months ago by buyers was ‘what is the sale price?’
“Now it is the opposite, we are putting it on to buyers to give us their expectation.”
Melbourne is the only capital city to still report annual losses, still down 4.2 per cent. But the tide is turning, with top end values up 4 per cent in the February quarter.
Prestige agent Jock Langley of Abercromby’s said the current conditions were a reflection of the market attempting to reach equilibrium. But this is becoming difficult as many quality homes in Melbourne are failing to hit the market due to demand.
“People here are starting to see confidence in the marketplace.
“A lot of stock isn't even hitting the market. The opportunity to buy off-market is what buyers want to do and even they are finding they need to compete.”
While it is not about the money for Brisbane sellers Dr Richard Slaughter and Adrianne Alexander, they hope their historic home in Brisbane’s inner-north can find the right buyer in these buoyant conditions.
“We didn’t want to put it on the market when the timing wasn’t right,” Dr Slaughter said.
“But agents did tell me the market right now was hot. I know our property is specialised, meaning it won’t be easy to sell but I am very surprised about the market above $1m. It has been phenomenal.”
The Federation-style home was originally on 6.5ha overlooking Clayfield, but now the 23-room property sits atop 2226sq m at 18 Tarranalma Avenue.
It is on the market for the first time in almost 25 years and has been restored over the period, from the hand-blocked wallpaper to the plaster mouldings, fireplaces and bow windows.
Expressions of interest are being taken by Ray White Ascot agent Marianne White.
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