This metropolis which is best known for its harbourfront Sydney Opera House is also the most populous urban area in Australia. Let’s take a look at what makes the capital of New South Wales so exciting.
#1 It is the finance hub of Australia
Sydney is the financial and business services hub for Australia, attracting many professionals from around the globe. According to the Global Financial Centres Index 25 compiled by think-tank Z/Yen, Sydney ranked 11th on the index of global financial centres in 2019. Sydney scored 735, up by 2 points. Sydney is home to branches of the Reserve Bank of Australia (RBA), Australian Prudential Regulation Authority (APRA) and the Australian Securities Exchange (ASX).
#2 Robust economic outlook
The NSW economy has been strong over the past three years, with the outlook for growth to remain above trend for the next three years according to projections in the NSW State Budget. NSW has been the fastest-growing state economy over these past three years, on the back of elevated household consumption, dwelling construction and public investment. Construction activity and expanding health services have contributed to more than 500,000 new jobs created since April 2011. Momentum in the labour market remains strong, with an employment growth forecast of 3% in 2018-19.
#3 Government investment
The NSW Government has committed to spending $87 billion over the next four years on health, education and transport infrastructure projects to ease the cost of living pressures. Major transport projects to receive funding include the new Metro West (new underground rail line between CBD and Parramatta), the new Parramatta light rail, Metro NorthWest (underway), the new Sydney Western Harbour Tunnel and Beaches Link, the first phase of underground F6 motorway between Sydney and Wollongong and road upgrades around the Western Sydney Airport.
#4 Rise of international visitors
International departure capacity at Sydney Airport expanded by 23.4% between 2012 and 2017 as reported by OAG Schedules Analyser. The increase has been driven by Oneworld member Qatar Airways adding Sydney to its network map over the past two years and six new routes to China following a deal to end passenger capacity restrictions. The top three Sydney to China two-way routes by capacity, in 2017, was with Shanghai, Guangzhou and Beijing. Each year since 2012, Tourism Australia has calculated international visitors to Sydney has grown on average 7.6%.
#5 Growth in international students
The number of international students enrolled to study in NSW education facilities rose 10.5% in the year ending December 2018, according to the Department of Education and Training. Higher education facilities saw an annual growth of 14.6%, while vocational education & training grew by 13.3%. The SSVF has made the process of applying for a student visa in Australia easier to navigate for both students and guardians.
#6 High ranking liveability
Sydney is placed well for liveability when measured against other cities around the world. In 2018, the Economist’s Intelligence Unit ranked Sydney in 5th position from 140 global cities based on stability, infrastructure, education, health care and environment. Mercer placed Sydney in 11th position in their Quality of Life index 2019. At the last Census, the Australian Bureau of Statistics (ABS) ranked Sydney’s Ku-ring-gai, Mosman and Woollahra in the top five Australian advantaged local government areas according to relative socio-economic conditions of people and households.
#7 Rising population growth
Sydney’s population growth trajectory has continued to rise each year since 2011. At this time annual growth was 1.2%, while in June 2018 annual population growth was recorded at 1.8% – the current total tops 5.23 million. This equates to 93,400 more people living in Sydney in the last year, or equivalent to 1,800 more per week. The ABS has projected the Sydney population to grow by a further 1.6% per annum to 2041.
#8 Construction starts slowed
Construction starts have slowed in Sydney. This means much of the recently added new rental stock has the opportunity to be absorbed while developers seek finance and pre-sales before construction can begin. At the current rate of population growth, the NSW state government has projected that an additional 725,000 new homes will be required by 2036, so this lull in construction can only be short-lived in order to meet this demand.
#9 Wealth flows
The total wealth of Sydney high-net-worth individuals (HNWIs) continues to rise. According to GlobalData WealthInsight, the number of HNWIs – those with a net worth of more than US$1 million, excluding their primary residence – is expected to grow by 21% from 2018 to 2023, to reach a total of 116,049 in Sydney.
Over the past five years, four millionaires were created every day in Sydney, this is expected to rise to 11 millionaires per day over the next five years. In 2018, the number of ultra-high-net-worth individuals (UHNWIs) grew by 4%, to 875, and projected to rise another 20% over the next five years—when Sydney will exceed 1,000 ultra-wealthy people by 2023.
#10 Relative value to other global cities
As wealth creation continues, Sydney prime property prices continue to show strength growing 2.4% in the year ending March 2019. Knight Frank considers prime property to be the most desirable and most expensive property in a given location, generally defined as the top 5% of each market by value. The other factor to consider is the global value proposition. In Sydney, at the end of 2018, US$1m could buy 52 sqm of prime property, while in Monaco, only 16 sqm could be purchased. At the same time, 22 sqm in Hong Kong and 31 sqm in both London and New York.
Knight Frank is the exclusive marketing agent for Crown Residences at One Barangaroo, Sydney, A limited collection of 82 Private Residences, set to become the defining landmark of the new Barangaroo precinct on Sydney Harbour.
For more information on Crown Residences, please connect with Dominic Heaton-Watson, Associate Director, International Residential, Knight Frank Malaysia via [email protected] or +6010 438 9169.