The overall stability of Australia’s post-pandemic recovery has attracted the eye of many international investors, with our property market boom continually proving itself to be a safe global investment opportunity. This influx of international dollars has many ramifications for investors and home-buyers alike, especially with Australia’s regional shift. The experts from Vision Property and Finance discuss the international property investment changes that are affecting the market below:
International Property Investment in Australia
In 2020, foreign direct investment (FDI) into real estate activities in Australia surged to over $120 billion dollars. This has largely been spurred by Chinese and American investors who are looking to capitalise on low-interest rates and surging property prices. Whilst a lot of this investment is from large portfolio investors, there has also been a lot of interest from people looking to migrate to Australia. These foreign investors and migrants tend to favour city living and place pressure on these markets.
What Does This Mean for Aussie Property Investors?
These international property investment changes are good for those who own regional and urban property, however is detrimental for those looking to begin investing. The international investment into urban areas increases the value of property in those areas, increasing property value. This can drive up sale prices or rental yields. Regional properties will also see more value, as more people will choose to migrate from urban to regional areas due to these urban price rises. This is the case for areas such as Kiama and Shoalhaven, which have seen a 20% growth in prices over the last year.
However, property investors looking to get into the market may experience some difficulty, with large international investors having more resources to purchase these properties, increasing prices and competition for supply.
What Does This Mean for Propspective Aussie Home-Owners?
Increasing international investment is making it tricky for domestic homebuyers to purchase property, with this increase in competition driving up purchasing prices in both urban and regional areas. Alongside this, increases in rent are making it more difficult for those looking to buy to save up for a deposit.
If you are looking for the best chance to getting on the property market with these international property investment changes, arranging a chat with a mortgage broker or a financial planner is the best place to start. Vision Property and Finance has provided our award-winning service in this area for over 20 years. If you want to join the hundreds of clients we’ve helped in this field, book a chat with us here.