Sydney and Melbourne property prices are rising - but by less than those their Chinese counterparts.
Like many other major metropolitan areas, the two Australian cities are in the midst of a relative affordability crisis. Despite this, properties have dropped several places on the list of the world's most expensive cities for luxury housing.
Asia dominated the list published in the Knight Frank Wealth Report for 2017. Prices in the Chinese capital Beijing jumped a massive 26.8 per cent, with Shanghai prices rocketing even more at 27 per cent. Sydney and Melbourne grew 9.3 per cent and 8.8 per cent respectively. This slowdown will likely draw those with plenty of cash to choose Australia for investment opportunities or to purchase a second home.
According to the report, Australasia was the strongest performing region in the world with an 11.4 per cent annual growth year- on-year. Wealthy people see Australasia as a safe bet given its consistent growth, and Australia is particularly appealing due to its strong economy and its stable political profile.
Since the financial crash, those investing in property favour stability over high-risk investment, making Australia the ideal choice. It is reported that of all people worth over $30 USD, up to 70 per cent of them will invest in Australia over the coming decade – specifically in Sydney and Melbourne.
Michelle Ciesielski of Knight Frank said that HNWI (high net worth individuals) are key to growing the Australian economy. Sydney is at the top of the list for the highest net inflows of HNWIs globally, with the inflow representing growth of four per cent of the HNWI population already based in the city.Melbourne came second on the list with an annual net inflow of 3000 HNWIs, while Perth came in eighth.