RUSH TO LUXURY
The big end of town is queuing to buy $ 4 million ‘ ultra- premium’ homes, writes Maurice Dunleavy
MANSION sales are making the rich even richer as waterfront properties soar through the $ 30 million- plus price barrier. A 13 per cent increase in properties selling for more than $ 4 million in the year to July mirrors a remarkable 12 months for ultra- premium sales.
In NSW alone there were more than 340 $ 4 million- plus sales worth almost $ 2 billion, while Queensland, Victoria and Western Australia shared a further $ 1.2 billion in sales.
But as impressive as those figures are, there’s much better to come, with Perth billionaire Angela Bennett about to blow Australia’s current $ 29 million home price record out of the water with an expected $ 70 million sale of her Swan River mansion.
The extraordinary offer price heralds a new era for Australia’s luxury home market, on the back of the China- driven mining and resources boom, and a new generation of 30- something buyers, mostly highly paid finance executives, willing to pay between $ 10 million and $ 20 million to own a waterfront mansion.
These buyers have not been deterred by high prices or rising interest rates.
The Australian asked researcher RP Data to assess the $ 4 million- plus house sales market of the past two years. The study found that at a time when residential markets around Australia had slowed, the premium end was unstoppable.
‘‘ There’s been a wave of demand driven by lifestyle, and a heck of a lot of money,’’ RP Data research director Tim Lawless says.
‘‘ We now regard the ultra- premium housing sector as bulletproof, with the rich likely to get a lot richer because of steady capital growth.’’
The RP Data study found that Australia’s top home sales were typically in suburbs with a water frontage, or views, and were close to CBDs.
But it identified emerging areas outside the big cities, and in NSW they include the Central Coast’s Gosford, Terrigal, Pearl Beach and Avoca.
South of Sydney, the Shoalhaven and Berrara had houses selling for more than $ 4 million, something unheard of five years ago.
In Queensland, most sales were along the coastal strip from the Gold Coast to Noosa Heads on the Sunshine Coast, as well as inner Brisbane riverside suburbs.
The northern beaches of Cairns and Port Douglas also made the elite sales list, as did properties on Victoria’s Mornington Peninsula. In Western Australia, $ 4 million- plus sales spread as far south as Busselton.
Australia- wide, in the 12 months to July, 570 homes sold for at least $ 4 million, compared to 506 in the previous 12 months.
Not surprisingly, 60 per cent were in NSW, with the 59 sales recorded in the prestigious Sydney lower north shore suburb of Mosman accounting for 10 per cent of nationwide sales.
Queensland was a distant second with 15 per cent of sales, followed by Victoria and Western Australia.
Real estate agent Bart Doff, who has sold some of Sydney’s most expensive homes over the past three decades, can’t see an end to the good times, which recently toppled a five- year price record held by Point Piper mansion ‘‘ Altona’’. It became Australia’s most expensive home in 2002 when it was bought for $ 28 million.
That record stood until August this year when Sydney property fund manager Gordon Fell paid $ 28.75 million for another Point Piper mansion, ‘‘ Routala’’.
It was quickly followed by the South African Krok family’s $ 29 million- plus buy of the Hawaiian- style ‘‘ Tahiti’’ in nearby Vaucluse.
According to Doff, there’s plenty of money and plenty of buyers, although a shortage of properties for sale has put a dampener on the market.
He can’t remember a time when there were fewer mansions on the market, with many owners playing a waiting game in the rising conditions.
He also can’t remember so many young buyers in a market that traditionally has been the domain of the middle aged and elderly.
‘‘ People in their 30s are paying between $ 10 and $ 20 million, which has never happened before,’’ he says.
According to Melbourne’s Xeon group, which regularly surveys home buyers, much of the money that has gone into top- end housing has come from the sale of shares.
Chief executive Barry Penn says investors who had made big share profits had moved their money into the tax- free haven of the family home. ‘‘ Our surveys indicate the rich still prefer to invest in houses,’’ he says.
Penn says Xeon’s most recent survey revealed that these buyers weren’t worried about rising interest rates. It also found that 20 per cent of respondents intended to purchase another up- market home in the near future.