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Brisbane had the best-performing luxury market on Australia’s east coast in the second quarter of 2020, according to Knight Frank's latest Prime Residential Review report.
The Queensland capital's lifestyle, relative value against southern counterparts and swift recovery from lockdown emerged as the key factors underpinning its growth.
The report found that Brisbane’s prime property price growth increased 2.5 per cent over the year to June, and up 0.3 per cent over the past quarter.
Prime or luxury residential property is defined as the most expensive property in a given location, generally seen as the top 5 per cent of each market by value.
As such, prime residential sales hold a $2 million threshold in Brisbane while in Sydney and Melbourne the threshold is $3 million.
The average time for a prime property listed on the Brisbane market dropped to 112 days in the June quarter from 116 days the previous quarter.
Queensland prime rents also grew by 6.9 per cent over the past year.
Knight Frank’s Head of Residential Research Australia Michelle Ciesielski said that a notable surge in global expat interest had been seen as a result of the pandemic, with an uptick in enquiries seen from Australian expats based in the Asia-Pacific region.
Ciesielski noted that in both Sydney and Brisbane’s prime property market a trend had emerged revealing an increase of renting until people find their next ideal home.
“Which has led to significant rental growth,” Ciesielski said.
“This trend has been exacerbated by a tightly held sales market, while in Brisbane it is also due to greater demand in the city, with Queensland’s capital now on the radar of returning expats attracted not only to the balmy lifestyle but the relative value.”
In terms of relative value, the Outlook notes that a buyer could secure 114sq m of internal luxury floor space in Brisbane for around US$1 million, compared to 89sq m in Melbourne and 51sq m in Sydney.
Ciesielski said Sydney’s prime market would see an ongoing undersupply of new stock, with 61 per cent fewer apartments to be developed in prime regions over the next five years.
She added that in prime regions in Brisbane there would be 62 per cent less new apartments and townhouses forecast over the next five years.
According to its City Wealth Index for 2020, Sydney ranked 15th from 100 cities around the globe, Melbourne ranked 40th, and Brisbane 67th.
