For those with $1.6 million to spend on a luxury home in Sydney, expectations may need to be adjusted. With this budget, buyers can expect to secure a relatively modest 45 square-meter apartment. However, compared to other major global cities, Sydney still offers better value for high-end property seekers.
Sydney ranks as the 11th most expensive city in the world for luxury real estate, with the average space buyers can afford for $1 million falling by a third over the past decade, according to Knight Frank’s Wealth Report 2025.
In contrast, other Australian cities provide more space for the same amount. The Gold Coast, for example, offers the most affordable luxury property market in the country. For $1.6 million, buyers can secure 119 square meters of prime real estate, significantly outpacing Sydney. Brisbane and Perth follow closely behind in affordability.
When compared internationally, Sydney fares better than cities like Monaco, where $1 million only buys a mere 19 square meters of luxury property. Hong Kong (22 square meters) and Singapore (32 square meters) also offer far less space for the same price.
Despite the global and domestic economic challenges, including higher interest rates in recent years, Australian luxury markets have largely continued their upward trajectory. Liam Bailey, Knight Frank’s global head of research, attributes this to “cash buyers who are less dependent on financing and lower supply,” contributing to price stability and growth.
Bailey also noted that the Reserve Bank of Australia’s recent rate cuts signal a shift towards market stabilization, with more positive sentiment expected in the luxury real estate sector. However, he predicts that price growth will moderate throughout 2025, influenced by factors such as geopolitical uncertainty and limited interest rate cuts in the first half of the year.
Australia boasts the ninth-largest population of high-net-worth individuals (HNWI)—those with assets exceeding $10 million—in the world, comprising 1.8% of the global HNWI population. In the coming years, this demographic is expected to grow, with an anticipated 5.3% increase by 2028 in Australasia.
The next generation of wealthy buyers is also showing a strong interest in luxury real estate. According to Knight Frank’s findings, property remains at the top of the list of luxury assets young buyers—aged 18 to 35—would like to own, seeing both its lifestyle appeal and its investment potential.
John McGrath, CEO of McGrath Estate Agents, emphasized that the luxury property market in Australia is buoyed by an ongoing undersupply, which is driving demand and, in turn, pushing prices upward. He believes the country’s attractive lifestyle locations and proximity to Asia continue to make it a desirable market for luxury real estate investments.
As Australian cities continue to remain competitive in the global luxury market, prospective buyers may find that while the Sydney market is expensive, it still offers relatively better value compared to other leading global cities.
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