Sydney’s luxury residential market is one of only two in the world which are expected to experience growth in 2015.
According to the Knight Frank Prime Global Cities Forecast
, of the eight cities* included in the report, only the New York and Sydney markets are poised for price growth.
Knight Frank international residential researcher Kate Everett-Allen said limited luxury supply is pushing Sydney prices higher.
As a result, they are forecast to grow by up to 5% in 2015.
Submarkets in the eastern suburbs and on the lower north shore are expected to outperform the city’s wider luxury market.
Rising business confidence and an increasing sense of political stability is helping to attract overseas interest in Sydney’s luxury properties, Everett-Allen said.
“The weak Australian dollar is adding to this momentum and is also reviving interest from Australian ex-pats.”
Historically low interest rates, which are not expected to change until mid to late 2015, and the fact that banks are keen to lend at competitive rates are also helping.
The report also noted that the House of Representatives Standing Committee on Economics recently delivered the findings from its review into foreign investment in Australia’s residential property market.
While it didn’t suggest that additional restrictions be placed on foreign purchasers, it did make a list of recommendations designed to ensure the rules are more rigorously enforced.
The Significant Investor Visa program, which attracts high net worth individuals, will be refined and a Premium Investor Visa will be introduced on 1 July 2015.
“This is a more expeditious pathway to permanent residency for those meeting a $15m threshold,” the report said.
*New York, Sydney, London, Paris, Singapore, Hong Kong, Geneva, Dubai
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