REISA UNSW: Newsletter T2W8

Welcome to Term 2, Week 8 of 2025!

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Real Estate News

The Gold Rush That Never Ended : Growing membership in Australia's “luxury” club

Luxury in the age of extremes isn’t uncommon, but the bar for “luxury” properties in Australia is becoming an arbitrary number, the year hasn’t ended but the top 20 luxury home sales have already surpassed $1.2 billion. In case you wanted to join, membership registration for the luxury club now starts at $2.52 million, 72% higher than a decade ago.

So where are the Hotspots for prime subscriptions?

Sydney has already sold more than 100 “super prime” (properties valued over $10M USD) homes in the past six months. The self proclaimed “harbour city” has an average membership fee of $4 million in suburbs like Point Piper, Vaucluse and Barangaroo. Scarcity for prime locations is reflected by the 33% shrinkage in value, $1 million used to get you 67spm of Sydney luxury now only buys 45spm today. But the luxury trend doesn’t just encompass the tourist favourite destination. Gold Coast, the prime (or used to be prime) location for surfers has set an entry fee of $2.6 million, getting its own nickname “Monaco of the South”. If Brisbane is included too, forming part of the “Golden Arc”, prices in these areas have increased more than 50% since 2015. Perth offering their Nedlands-Dalkeith-Crawely enclave is playing catch up growing 9% in just a year, getting traction from east coasters and overseas.

But why are so many international buyers interested? Exchange rates. As per-developers forecasts, the weak Australian dollar offers a 5-7% “discount” for buyers holding US dollars, HK dollars and pounds, making Australia’s addresses a global bargain. Local members are in a time crunch, prices are in no way slowing down with perpetually tight supply attributed to developers focusing on bespoke builds for the few, (think one-off, high-impact, unique homes), no dozen of units will magically appear anytime soon. Racing against the suitcases of global liquidity foreign investors pack, interest rates are out of the consideration. With three RBA interest rate hikes in the rearview, luxury values barely flinched, remember? Foreign investors packed cash. The government is in no rush to stop the monetary inflows either, actively courting offshore wealth. The Foreign Investment Review Board’s new “fast-track” approvals gives trusted foreign buyers the green light in 30 days. Mansion tax is just a buzz word, stamp duty and land tax are minimal compared to proportional spending. Wealth is clustering around Australia’s shrinking strips of metropolitan coastline breeding a new status competition defined by the movements of the super-rich.

But who are these buyers? Forget the old-money caricatures. Today's luxury market has a diverse range of customers, redefining the word “luxury” itself. Young Entrepreneurs in their 30’s and 40’s splurging on beachfront views. Millennials and second-generation moguls want smart homes with unique architecture. Half the foreign capital from overseas buyers from China, Singapore, US, India and UK are invested in property, attracted by easier buying rules and Australia's livability and political stability. Single women buyers are becoming an increasing demographic, wanting secure and lifestyle focused homes. “luxury” now meets wellness and technology, houses with cryosaunas, yoga retreats and lap pools fetch 10-25% price premiums and energy efficient solar powered homes with water recycling are on the rise.

But the membership doesn’t come without nuisance. The tortoise and the hare is a classic fable we’ve all been told, Sydney is unfortunately (or fortunately) the tortoise growing the slowest out of the hotspots at 3.1% a year. Perth is the hare, with growth at 3.7% and Brisbane (the middle child) at 2.4%. But slow and steady wins the race, Sydney still holds the crown for the most expensive properties, with national forecasts to 2030 showing luxury homes will maintain a rise of 5.3-5.7% per year with estimated sales of $33 billion.

The future of luxury real estate in Australia is a battle royale of local ambition, global capital and policy mood. As the Gold Coast rises, Perth surprises and Sydney simply refuses to relinquish its crown, the message of 2025 is clear: in the area of luxury property the only thing more valuable than money is imagination.

Written by: Amber Ho

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Real Estate Investment Student Association (REISA), is a student run society founded in 2023 with the objective of providing students with opportunities across all aspects of Real Estate Investment, including Private Equity, Advisory, Development, and Asset Management.

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