Perth’s luxury residential property market is expected to continue strengthening over the coming year now the city has reopened to the world.

Knight Frank’s Wealth Report for 2022 shows Perth came in at number 31 on the Prime International Residential Index (PIRI 100) in 2021, which tracks movements in luxury prices across the world’s top residential markets.

An ultra-luxurious sub penthouse with four bedrooms, four bathrooms and three car bays is on the market for $4.5 million at The Towers at Ritz-Carlton in Elizabeth Quay.Credit:Domain

Perth edged out dozens of well-known international cities such as Monaco, Zurich and Athens.

Perth prime prices (properties that sold above $2 million) experienced 10.5 per cent growth, coming in behind Sydney, ranked 17 with 16.2 per cent growth, and Brisbane, which ranked 29 with 11.2 per cent growth. Melbourne came in at number 39, with 9.4 per cent growth.

As prices have risen in Perth, how much internal luxury floor space US$1 million can buy in the city has fallen below 100sqm to 98.4sqm, behind Melbourne at 84.3sqm and Sydney at 41.4sqm.

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On the City Wealth Index, which assesses where the wealthy prefer to live, spend time and invest, Perth was ranked 67, which was the last of all the cities in Australia, but an improvement from 2021 when it was ranked 74.

The number of ultra-high net worth individuals in Perth rose by 10.5 per cent in 2021, and is expected to grow by another 23 per cent by 2026 to reach 2,408 from the current 1,961.

Mack Hall of Mack Hall Real Estate said Perth’s luxury market was only just gearing up, with a forecast rise of 6 per cent over 2022.

“Now our borders have reopened to the world we have started to see greater visitor arrivals and more interstate and overseas investors looking for opportunities, which will equate to greater demand for luxury residential property,” he said.

“The wealthy are attracted to Perth due to the city’s relative affordability to east coast cities, especially for living near the water, as well as outstanding lifestyle, including its balmy climate.”

Knight Frank’s head of residential in Asia Pacific, Victoria Garrett, said Perth’s proximity to Asia was once again attracting wealthy people, particularly from south-east Asia.

“Our clients across South East Asia find the prime luxury price point in Perth attractive over other Australian cities, and it’s a short flight home and within the same time zone, making it easier to do business,” she said.

“Due to the Australian foreign investment framework, our non-resident clients are restricted to buying new homes and there simply hasn’t been enough built in Perth’s prestige locations in recent years.

“With more apartment projects earmarked with high-end luxury amenities, this will be attractive not only to international buyers but those domiciled in Perth as travel is again on the agenda – and they can easily lock up and leave.”

One of the suburbs set to capitalise from the ongoing growth in Perth’s prestige market is the riverfront locale of Applecross which has risen in value by 12.2 per cent in the year to March 2022.

The view of Perth from a home in Applecross. Credit:Domain

In 2011, the suburb recorded just three prime sales with an average sale price of $2.82 million.

But in 2021, Applecross recorded 33 prime sales with an average sale price of $3.68 million.

Mr Hall said the affluent suburb would continue to be highly sought after by buyers.

“Not only is it close to the CBD, with good connectivity to three world-class universities, top private schools and other amenities, but it is picturesque,” he said.

“Applecross attracts both local and international families, drawn to its combination of proximity to Perth’s urban action and quiet suburban allure.

“Houses in Applecross start from $2.4 million, putting it among the 10 highest-priced suburbs in Perth.”