Luxury Apartment Spending Sky High
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Luxury Apartment Spending Sky High

Spending on super-prime apartments has surged in the first half of 2021.

By Terry Christodoulou
Thu, Oct 14, 2021Grey Clock 2 min

Sales of luxury apartments worth more than $10 million have risen nearly eightfold during the first half of 2021 when compared to the decade average according to Knight Frank research.

Ultra-rich buyers have splurged more than $650 million in Sydney alone with 67 super-prime luxury apartments changing hands around the country – a steep rise from the 8.7 average annual sales over the past 10 years. Of note, the majority of the transactions were at Crown Residences at One Barangaroo.

Knight Frank defines super-prime properties as the top 1% of each market by value. Around the country that sees a threshold of more than $10 million in Sydney and Melbourne and $7 million in Brisbane, Perth and the Gold Coast.

The recently coined ‘rightsizer’ – those downsizing from stately homes to luxury apartments – tended to target newly built or off-the-plan apartments. However, Sydney differed from the rest of the country where the lack of new stock forced buyers to look at existing builds according to Michelle Ciesielski, Knight Frank’s head of residential research.

“The surge in demand was driven by ultra-wealthy buyers looking for a low maintenance apartment with house-like proportions for entertaining, as well as those seeking a secured luxury apartment residence that can be easily locked up when they jet off for long periods of international travel again next year,” she said.

Higher demand for luxury apartments has lifted values for new apartments by 46% since June 2015 – outperforming the established apartment market which recorded a strong, 31% increase in major cities.

Sydney was the only city that didn’t follow the trend, with the older stock soaring by 48% compared to 30% for new apartments.

Ms Cieselski said apartment values should continue to rise further in the years ahead, with a falling supply forecast.

“In contrast to increasing demand, the pipeline of new apartments in prime regions around Australia will fall by 39% over the next three years across low-rise, mid-rise and high-rise projects, which will mostly be felt in Brisbane and Sydney,” she said.


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New research from Knight Frank’s International Waterfront Index shows waterfront properties are costing more than double their inland counterparts in Sydney while in Melbourne waterside properties attract a 40% premium.

Australia’s coastline attracts some of the highest waterfront premiums in the world with Sydney topping the index — an average premium of 121% — compared to an equivalent home set away from the water.

Auckland ranked second on the list of 17 international locations — a premium of 76%. The list saw Gold Coast (71%), Perth (69%) and the Cap d’Antibes (59%) on the French Riviera round out the top 5.

Australia continued to feature prominently in the research with Brisbane’s waterfront premium coming in at 55%, with Melbourne also in the top 10 at 39%.

According to Knight Frank Australia’s head of residential research, Michelle Ciesielski, there has always been strong appetite for Sydney’s waterfront homes.

Australia’s luxury residential market has advanced, it lacks the depth of prestige markets in more established global cities said Cieselski.

“As a result, our Australian cities can achieve a significantly higher premium on the waterfront compared to a similar property inland without access to, or a view of, water,” she said.

“Also, Australia is known for its balmy outdoor lifestyle, so many buyers in this super-prime space are willing to pay a premium to secure the ideal position along the waterfront.”

The data also suggests that beachfront homes were most desirable, commanding a premium of 63% compared to harbour locations fetching 62% premium and coastal homes with a 40% premium.