Sydney's Luxury Property Prices are Rising at One of the Fastest Rates in the World

Photo Credit: Nick Wilson/Allsport

Luxury property prices in Sydney last year rose at one of the highest rates in the world, only beaten by Vancouver.

In a quarterly report released by Frank Knight which looks at property in the top 5% of the wider housing market in cities across the world, Sydney’s prices increased by 14.8% year-on-year.

By comparison, Vancouver’s prices increased by 24.5% over the same period.

Chart: Knight Frank.

Melbourne, meanwhile came in at fourth position.

Overall, Australasia was the strongest performing world region in 2015.

In a prior report released by the company which looks at the same real estate category, assessing the performance of prime residential city markets for 2016, Sydney is forecast to see that growth continue, predicted to rise another 10% year-on-year.

Note: This chart did not include data from Vancouver or Melbourne. It ranks the ten cities listed. Chart: Knight Frank.

Researchers suggest the lower rate of growth in 2016 is contributed to Australia’s economic slowdown, weaker stock market performance and the introduction of foreign investment fees.

In the quarterly report Frank Knight partner of residential research, Kate Everett-Allen says there could also be a more significant shift in global rankings due to further rate rises by the Federal Reserve and heightened geopolitical tensions.

“Add to this the recent stock market volatility, jitters over the economic news emanating from China, the slump in oil prices and the fragility of emerging markets and the risks look to be mounting,” she said.

“It is unclear at this stage, given the removal of stimulus in some markets (as well as policy changes, new taxes and fees in others) whether a global economic slowdown would once again prompt strong capital flows into luxury property in the same way it did post-2008.”

SOURCE: Business Insider Australia
POSTED: April 21, 2016
AUTHOR: Sarah Kimmorley