Australia’s status as a safe haven is attracting more cashed-up foreign property buyers than any other country globally, underpinning strong property price growth.

In 2023, Australia reclaimed the top position for net millionaire arrivals, with approximately 5,200 individuals entering the country, according to a new report by leading luxury agency Kollosche in collaboration with industry analyst Michael Matusik.

The United Arab Emirates ranked second with 4,500 new millionaires, followed by Singapore with 3,200, and the United States with 2,100 cashed-up migrants in 2023.

While many of Australia’s new millionaire migrants settle in either Sydney or Melbourne, the Gold Coast attracts an average of 10 to 15 percent of them each year, the Property Price Drivers report notes.

“For a city that makes up only 3 percent of Australia’s population, the Gold Coast is punching way above its weight in this regard,” says Kollosche Director and Selling Principal Michael Kollosche, whose Broadbeach-based agency counts a long list of high-net-worth clients on its books.

“Australia is seen as a safe haven among our buyers. You can also get a significantly larger house or apartment on the Gold Coast compared to Sydney and Melbourne for the same price, and arguably with a much better climate and lifestyle which certainly plays into it.”

Much of the recent overseas demand for Australian property has come from potential owner-occupiers rather than investors. Instead of buying smaller properties to let, the report reveals that foreign buyers are opting for spacious dwellings in which to live.

“This is especially the case for Chinese and Taiwanese buyers,” says Michael. “Although property prices on the Gold Coast rose by 7 percent over the 2023 calendar year, the city’s real estate continues to offer better value for money than most metropolitan areas.”

Foreign buyers are subject to specific regulations set by the Foreign Investment Review Board (FIRB). While non-residents can purchase new properties or vacant land for development, they generally need FIRB approval to buy existing residential properties.

Offshore buyers account for around 5 percent of established house sales, according to a recent survey of the national housing market by National Australia Bank, while foreigners who do not live in Australia full-time bought up to 10 percent of all newly-built homes sold in 2023.

“Wealthy expats are really looking for trophy assets to buy with a view to relocate home down the track,” says Michael. “Off-the-plan apartments are also proving very popular with expats and interstate migrants because they can secure something at today’s prices and sit on them for a two to three years while the developments are delivered.”

“Having more affluent people coming into the buyer mix does drive price growth, and in markets like the one we’re currently in you need to have a decent net worth and serviceability to be able to participate.”

Sold for $11,500,000 – 2 Surf Street in Mermaid Beach

Demand from cashed-up foreign buyers is among the three key factors identified by the report as underpinning consistent property price growth nationally. Construction costs and a shortage of new housing stock were also keeping housing prices buoyant.

“It’s unlikely that the construction situation will completely ease until we get closer to the Olympics and all of the public infrastructure works are completed,” Michael says, “as that’s what has absorbed a large portion of the labour force in Queensland.”

Over the past 20 years, the Gold Coast has outperformed the national average when it comes to price growth for both detached houses and apartments, the report found. Since 2020, detached house prices on the Gold Coast have risen by $350,000 or 56 per cent. Nationally prices have lifted by 28 per cent or $217,000 over the same period.

The first week in April saw Kollosche agents transact $47,120,000 at auctions in less than 24 hours, with three properties – 75-81 Stanhill Drive on Chevron Island, 2 Surf Street in Mermaid Beach, and 175 Jefferson Lane in Palm Beach – each selling for $10,000,000 and over.

The $11,500,000 sale of the 53-year-old unit block on Surf Street amounts to $28,395 per sqm – a then record price for land on the Gold Coast and more impressive when considering the height limit is restricted to only 15 meters. That was superseded just weeks later by the $18,000,000 sale of a 600 sqm tower site at 59 Garfield Terrace, Surfers Paradise which represents $30,000 per sqm. The buyer of the Garfield Terrace site was Canadian-based Fine Peace Development (Australia), a company set up late last year, which has Chinese directors

“There is real depth among buyers in the market at the top end and limited supply,” says Michael.

“For us to get the level of interest and the number of offers and bidders that we’re getting on so many properties in the $10 million to $25 million range over the past couple of years tells you that the market has definitely matured and generally is very strong.”

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