Australia, Singapore most sought-after locations for APAC homebuyers

One in five ultra rich individuals in APAC plan to buy a new house this year.

According to Knight Frank’s latest edition of The Wealth Report 2021, 26% of ultra-high net-worth individuals (UHNWIs) globally are planning to buy a new home in 2021, a sharp increase from the 21% revealed in 2020. This demand will help fuel price rises of up to 7% in key markets over the course of the year.

The Attitudes Survey* revealed that a lower percentage of UHNWIs in the Asia-Pacific** region have bought new homes in 2020, with 1 in 4 respondents intending to buy a new home in 2021. The survey also revealed that these homebuyers are particularly interested in purchasing a second home in UK, US, and Australia, followed closely by Singapore.

Victoria Garrett, Head of Residential, Asia-Pacific at Knight Frank, said, “In a Global Buyer Survey conducted last year, the increased flexibility of remote working has fundamentally changed the demands on and expectation of homes. Coincidentally, 26% of those surveyed indicated that they were more likely to buy a second home in countries that they felt were able to handle the crisis well – as a result of the pandemic.

As 2020 progressed, we witnessed more travel bans and even second or third lockdowns. While the purchase intentions for new homes have not changed, the reasons of purchase have. UHNWIs are now looking to upgrade their main residences (usually domestically), followed by having a holiday home (domestically or abroad).

With the pandemic supercharging demand for locations that offer a surfeit of wellness – mountains, lakes and coastal hotspots, paired with low mortgage rates and other government aids, it is no surprise that territories such as UK, US and Australia stay top-of-mind for homebuyers in Asia-Pacific.”

Nicholas Keong, Head of Residential International Project Marketing, Knight Frank Singapore, shared, “Among the Asian wealthy, the luxury residential market in Singapore is the top Asian territory of choice when purchasing a new home, ranked behind UK, US and Australia. Asian home buyers from India, Japan, Malaysia and South Korea rated Singapore in their top-five list of locations when considering investment homes abroad. The manner in which Singapore’s government was able to financially support businesses as well as put in place measures to control the spread of COVID-19 further enhanced Singapore’s reputation as a safe bastion for investors in an unpredictable world.”

Auckland leads Knight Frank’s Prime International Residential Index (PIRI) with price rises of 18% in 2020. New Zealand’s handling of Covid-19, its rapid economic recovery, ultra-low mortgage rates and limited supply of stock were behind the surge.

The index, which tracks the movement of luxury residential prices in 100 cities and second home markets globally for the 12-months to the end of December 2020 also reveals:

• Asian cities occupy the next three rankings: Shenzhen (+13%), Seoul (+12%) and Manila (+10%)

• Australasia (4.9%) was one of the top-performing regions in 2020. The region saw a surge in pent-up demand as lockdowns eased and homeowners re-evaluated their lifestyles • Perth (+4%) was Australia’s frontrunner and Sydney (+1%) registered its highest volume of prime sales ever in the third quarter of 2020

*In Q4 2020, Knight Frank surveyed over 600 private bankers, wealth advisors, intermediaries and family offices managing approximately US3.3 trillion on behalf of UHNWIs across the globe
**Excluding Cambodia, Indonesia and Thailand

To read the full Wealth Report 2021, visit: https://www.knightfrank.com/wealthreport