Tight supply is set to drive up the price of luxury homes in the Lower North Shore of Sydney, which includes the suburbs of Neutral Bay, Cremorne, Mosman, Kirribilli and North Sydney. Peter Corbett, a director of the Real Estate Institute of New South Wales, said developers were finding it difficult to obtain land for property development along the area's seafront. He expected the prices for luxury homes would rise 16 per cent this year and continue to see steady growth. Mr Corbett, who is also managing director of Ben Boyd Asia, said most Hong Kong buyers snapped up residences in the area for long-term investment. Ben Boyd Terraces, a luxury residential project in Neutral Bay, had met with good response in Hong Kong and only three townhouses remained available, he said. Each house was worth between A$700,000 (about HK$4.10 million) and A$750,000 and the gross area of 2,790 sq ft to 3,550 sq ft included garden and courtyard. The company claimed the properties could generate a rental yield of 5 to 6 per cent. Mr Corbett said the Sydney 2000 Olympics would attract international attention and some analysts had forecast prices in the city could rise almost 40 per cent in the lead up to the games before sliding on their conclusion. But he claimed the fundamentals for the Sydney property boom were supported by strong economic growth.