Affluent buyers on the rise

New data prepared exclusively for The Wealth Report by Knight Frank highlights that the number of ultra-wealthy people in Perth – those with net assets of US$30 ($43) million or more – is expected to rise by 21 per cent over the next five years, potentially having an impact on the higher end real estate market.

The data provided by GlobalData WealthInsight highlights that the ultra-wealthy population is projected to grow at an accelerated rate when compared with the past five years, with an expected addition of 600 ultra-wealthy individuals in the next five years.

“Globally, Australia remains one of the top destinations for ultra-high net-worth individuals. For example, we know Chinese and South East Asian buyers continue to look at familiar global markets such as Sydney, Melbourne, London and Hong Kong, which offer language advantages and immigration possibilities, as well as remaining outside any trade disputes,” Knight Frank Head of Residential Australia Sarah Harding said.

William Porteous Properties International Director Andrew Porteous said he had witnessed the market for ultra-wealthy people recently seeing a spike in interest.

“It is interesting, in spite of the COVID-19 situation, we have actually experienced quite a bit of activity and interest from both local money and overseas money,” he said. “Perth is a desirable location. I think now with the coronavirus situation, its isolation is our greatest gift. We are so blessed to live where we live, and I think people that know Perth and have been to Perth really appreciate that.

“I think we are going to see a lot of people come back to make Perth home, we are already talking to people from Hong Kong, the UK and Singapore to sell up and bring that money back and into Perth.”

Mr Porteous said these ultra-wealthy individuals were drawn towards riverfront suburbs like South Perth.

“The premium is always paid on the water,” he said. “They usually want to put their money in the best location – you need to tick all the boxes.

“In terms of supply and demand, Perth is a very small market. There is not a lot of really good stock on the market.

“If you have something that ticks all your boxes, people will pay the price for that and I think places like South Perth and the South Perth Esplanade are good examples of people paying high prices for things like penthouse apartments.”

He also noted they often had their families at schools nearby which influenced their buying decisions.

Mr Porteous said many of these individuals were looking towards apartment living as a tantalising proposition, especially later in life, having witnessed penthouses in South Perth go for up to $10 million.

“We are finding now as people get older, a lot of them live in these big houses and it can become a headache,” he said. “A lot of them want to travel, so they want something that is a lot more lock-and-leave.”