RESEARCHING THE AREA
Wealth creation continues to gather momentum, increasing the ultra-wealthy population. Despite uncertainty over the future path of fiscal, economic and political policy, wealth creation has gathered momentum, increasing the number of global ultra-high-net-worth individuals (UHNWI) by 4% throughout 2016. The ultra-wealthy, an individual with a net worth of over US$30m excluding their primary residence, are looking to diversify into new and emerging global markets to preserve future wealth. 3 Property remains a substantial target for this outbound capital, and its likely 32% of UHNWIs globally will invest in offshore real estate in the next two years. Over this time, 30% of Australasian UHNWIs are likely to purchase another residential property within Australasia.
Australia is well-positioned for continued inflow of HNWIs in the coming years. There is ever growing demand from the global wealthy population to move their money into ‘safe-havens’, although increasingly challenged by governments to exercise control over that process. Although wealth flows can be successfully corralled and redirected, they will not be curbed. Demand for prime property continues to outweigh the limited supply being bought to market in both the established and new supply markets. Locally, retirees and those approaching retirement are still taking advantage of this supply gap in the market, achieving elevated prices for their family home and downsizing to a low-maintenance home, with high-quality modern conveniences. The expat dollar is still favourable and many are securing their ideal home for a future return to Australia. Foreign interest in prime Australian residential property has remained relatively strong throughout 2016 with many currencies holding an ongoing purchasing power against the Australian dollar. More due diligence is being carried out by purchasers, particularly due to tax surcharges being introduced, stronger penalties being enforced by the Australian government for those who breach the rules, and the processing fee now payable for every application to the Foreign Investment Review Board.
The movement of private wealth across the world can take the form of temporary investments while others, like migration, are more permanent. At the end of 2016, the UHNWI population in Sydney was estimated at 1,230 persons, up 12% over the past year. Sydney is projected to see 70% growth in its UHNWI population between 2016 and 2026, as reported by New World Wealth, in the Knight Frank Wealth Report 2017. The latest data on high-net-worth individual (HNWI) migration has followed a similar trend, confirming the strong and growing desire to live in Australia, for those individuals with a net worth of over US$1m excluding their primary residence. Leading all cities around the globe, Sydney saw the highest net inflow, at 4,000 HNWIs, over the last year. This represents growth of 4% on the 106,800 HNWI population already based in Sydney.
Residential house prices in Braidwood have experienced growth of 45.2% since December 2008, slightly lower than the 46.3% recorded for Canberra houses over the same time. In the past three years, Braidwood has had annual average house price growth of 8.1%. Braidwood Capital Growth Index = Dec 08
Canberra Houses Braidwood Houses
100 110 120 130 140 150 160
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