Several years ago just a thought of investing in the Australian’s real estate market would be impossible due to stringent policy being established. However, recently the Federal Government has loosened the policy that if a non-resident resides in Australia for more than 12 months he or she is eligible to purchase a new dwelling in the country.
Where are the foreign buyers from?
According to one of Australia’s popular real estate website, most of the foreign buyers who has been investing in the Australian market are predominantly from Asia particularly the neighboring countries such as Hong Kong, China, Singapore, Malaysia, Taiwan and South Korea. There were no specifics property type that this group are aiming for such as the types of properties bought were ranging from apartments to land houses. However, geographical area seems to have higher determination factor for the buyer’s decision making.
Why Australia though?
There were couple of reasons why Australia has been popular among the buyers. Australia’s strong economy has proven a record of stability over the years which boost buyer’s confident in real estate market. Likewise, Australia’s real estate market was not really affected much compared to USA when the bad recession hit in 2008 and research showed that the value of the Australian’s properties has been steadily increasing over the years.
On top of that, with the economy crisis and political instability that is happening in many countries and some of the foreign buyer’s home country has allowed them to turn their attention to Australia as the Aussie dollars are more sustainable in terms of currency. Also by buying a home in Australia, it may assist a family member building his or her residency with the country.
How this has impacted Australia’s real estate market?
Since the loosening of the policy, there are high demands flooding in especially from the Chinese market as their country’s economy has been prosperous after the economic reform in 1978. Wealthy Chinese are purchasing many dwellings by cash and has resulted higher property prices as they always overbid the market value. According to a research it was only 2 to 3 years ago that the bigger cities in Australia started constructing new dwellings to meet the demand but with such high demand within a short period of time it has driven the real estate market price up.
“Sydney’s narrowest house auction at 29 Terry Street, Surry Hills, earlier this year. The property sold for $965,000 to a Chinese phone bidder” according to News.com.au
To invest or not to invest?
At the end of the day it is still boils down to the buyer’s decision making whether he or she is comfortable investing in overseas as there are many uncertainties and policies to adhere. Thus, before investing it is advisable to do one’s due diligence from reliable resources or buyers may also consult an expert such as buyer’s agent to assist in decision making. Obviously there is no perfect time to buy a property in Australia but is always advisable to consider the consequences of buying a home in overseas. Nevertheless, with well-equipped information and the appropriate assistance from a buyer’s agent one would find investing in Australia is simple and worth it.