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LONDON: Luxury new apartments are selling twice as fast as two years ago, driven by demand from the growing ranks of wealthy baby boomers eager to secure their “ultimate reward”.

A report by Gold Coast agency Kollosche with property analyst Michael Matusik found a 30 per cent shortfall of new dwellings, with high-end units priced at $2 million and above snapped up by both local downsizers and international buyers seeking a low-maintenance life of luxury by the coast.

Prime new apartments, identified as the top 5 per cent of sales in each city, spent an average of 51 days on market in Brisbane in financial year 2022/23, compared with 115 in 2020/21.

Gold Coast buyers snapped up their ritzy real estate prize in 68 days this year, compared to 140 days two years ago.
More than one-third of prestige apartments sales were on the Gold Coast.

The Kollosche Property Insights: Market Trends Report found the volume of top-end transactions had soared since 2021, with 3,270 residences priced at $2m-plus sold in new projects across the region last financial year.

More than one-third (1,300) of those were on the Gold Coast.

Kollosche head of new projects Jamie Harrison said downsizing baby boomers sought boutique apartments offering luxury amenities, lock-up-and-leave options, distinctive architecture, and attractive capital growth potential.

“Luxury residential buildings are highly desirable to this demographic, and because they are generally selling their principal residence to invest in a luxury lifestyle asset they are paying with cash,” Mr Harrison said.

Australia’s robust property cycle of the past 20 years had created combined net housing wealth of about $7 trillion, underpinning a strong future buyer base, according to the report.

As the population ages, about $272 billion will be passed on in inheritance over the next decade, with a large portion expected to be invested in real estate.

“The wealth shift will have a major impact on boutique development in the coming years as a growing demographic seeks to treat themselves for years of hard work, with a luxury beachside apartment, which they view as the ultimate reward,” Mr Harrison said.

International buyers and expats, who increasingly viewed Australia as a safe haven amid potential future pandemics and social/political unrest, were also eyeing high-rise homes.

New dwelling approvals in Queensland were at about 36,500 starts per year, which was failing to meet the rising demand. The deficit was most evident on the Gold Coast, where 30 per cent fewer homes than needed were being built.

“While the shortfall is driving up land prices, it is also accelerating the demand for new attached dwellings, particularly well-designed, positioned and appointed oceanside apartments,” Mr Harrison said.

Continuing pressure on the construction industry was expected to fuel further price rises, with residential building resources diverted to upcoming 2032 Olympic building commitments and other significant infrastructure projects.

“There is a definite shortage of housing across all sectors,” Mr Harrison said.

“Those developers who can demonstrate a proven track record and have sound relationships with key delivery stakeholders to produce boutique products with the right level of amenity and finishes are going to really benefit over the next two to three years.”