How much rich Australians are willing to spend on luxury holiday homes this summer

Australia’s wealthiest holidaymakers are still splurging tens of thousands of dollars a week to rent holiday homes, but with COVID in our rearview mirrors and international travel back on the table, the luxury holiday market is not as in demand as  it once was. 

Let’s go back in time to the pandemic. International borders were closed, and many Australians were forced to holiday at home.

While some purchased a sea or tree-change property, taking advantage of the record-low interest rates at the time, others remained in their respective cities and ventured out of state only during the holiday season.

And what a time that was for the luxury holiday market; wealthy holidaymakers spent up to $100,000 a week for palatial mansions in the country’s favourite beach hotspots.

“When people couldn’t go anywhere, it was an easier role to market properties in some sense … we were getting booked back-to-back even during the low seasons but now we have to be very clever in our operation and how we’re marketing homes,” says Bobbie Murphy of Niche Holidays Noosa.

The heady days of the pandemic holiday sell-out seasons may be behind us, but Murphy says demand for Australian luxury holiday rentals is still there.

“Despite this, luxury travel is still very strong, and as we head into the holiday season, families are spending upwards of $70,000 to $80,000 a week for our properties.

“[This year] was a different year compared to the last year and [it’s] one that we had to navigate quite carefully as far as marketing our properties go.”

Matthew Fleming of Contemporary Hotels says domestic travellers are taking overseas holidays this year; however, international tourists have filled that gap.

According to data from the Australian Bureau of Statistics, there was a resurgence in international visits to Australia throughout the year. The months that saw the most arrivals were July and October, and the months with the most departures were July and September.

“Holidaying at home was a great promotion locally and it did really well but, frankly, people had little choice in terms of where to holiday,” Fleming says.

“Fortunately for us, it’s been balanced by international travellers coming in … All our travellers have deep pockets and are willing to spend on a luxury experience. Travel these days is highly centred on experiences, enjoyment and simplicity. 

“Whilst most of our clients spend between $20,000 and $50,000 on their home, they will spend more on local businesses such as cafes, restaurants, in-house chefs, surfing lessons and more.

“There is a great flow-on effect into the local economies. At the ultra-luxe end of the market, we’re talking helicopter day trips to wineries, private yachts or even Indigenous experiences on Clark Island in Sydney Harbour.”

The Penthouse in Sydney is asking for $100,000 a week and offers visitors city skyline views in Darlinghurst.

“Sydney is our trophy market with properties that go for up to $100,000 to $200,000 a week,” Fleming adds. 

Just released on the market for the Christmas and New Year season is Byron Bay Villa, which is asking $20,000 for a week. Although due to building works around the neighbourhood, it is offering a 10 per cent discount on the nightly rate.

It’s located by the exclusive Wategos Beach, fringed by tropical gardens and designed by Australian design master Iain Halliday of bkh. The property boasts open planning living, floor-to-ceiling windows and iconic beach views.

“We expect strong demand for this property given its location at Wategos Beach, it’s one of the few west-facing homes,” Fleming says.

With fewer domestic travellers, Murphy says owners have had to make adjustments.

“The properties that are about $10,000 a week, which are two-bedroom properties, those are the ones that are harder to fill,” she says. “We’re continuing to work really hard to fill some properties over that Christmas period because rates are so high.”

“Our main competitors at the moment are the overseas markets in Europe and Bali … Noosa is still a place where people do choose to travel and have done so for many, many years, and I think that’ll continue, but we can’t sit back anymore, we have to work for the consumer to come to Noosa.

“It’s still busy, but we’re predicting occupancy levels to be more in line with 2019 levels when autumn and winter come around – so pre-COVID days. A lot has changed in the market.”