Are you looking to buy a property during the market downfall? You are not the only one. There has been a surge in interest in the market from foreigners.
Recent data from PropTrack shows that foreigners searching for a property to rent in 2022 on realestate.com.au increased by 65%, compared with 2021, and people searching to buy increased by 10%.
Let’s go through some other highlights of the report. Then we’ll see why these numbers just might make now the perfect time to invest in property.
Property Search Trends In 2022
PropTrack’s data shows:
- The rise in search queries coincided with the arrival of migrant workers and students back to Australia. The number of visas issued for entry into the country increased tenfold from 2021 to 2022.
- The top countries for people seeking property in Australia are:
- Rental searches from New Zealanders increased by 76% from the previous year, and those from India increased by 48%.
- While searches increased overall, searches for properties to buy have decreased in all countries except for New Zealand and India, where they increased by 13% and 12%, respectively.
Where Are Overseas Buyers And Renters Looking For Property?
| Ranking | Top Searched Suburbs And Regions By Overseas Buyers | Top Searched Suburbs And Regions By Overseas Renters |
|---|---|---|
| 1 | Melbourne CBD, VIC | Melbourne CBD, VIC |
| 2 | Gold Coast, QLD | Sydney, NSW |
| 3 | Sydney, NSW | Brisbane – City, QLD |
| 4 | Brisbane – Greater Region, QLD | Gold Coast, QLD |
| 5 | Perth CBD and inner suburbs, WA | Perth CBD and inner suburbs, WA |
Source: PropTrack Overseas Search Report
- Melbourne was the most sought-after city for both buying and renting in 2022, with Gold Coast a close second for buyer searches and Sydney second for renters.
- The Gold Coast remained the most popular spot for property seekers in New Zealand. Meanwhile, individuals in Hong Kong showed interest in the suburbs of Chatswood in Sydney, and Box Hill and Doncaster in Victoria, all of which are known for their Chinese communities.
- As foreign buyers are restricted to buying only new properties or vacant land on which development is planned, new builds attract the most attention.
- The most viewed new developments in 2022 were:
Why Will Foreign Demand For Property Increase In 2023?
The report shows the influx of overseas people looking into Australia’s property market to rent or buy. This trend, and several factors related to migration, will increase demand for Australian property this year. Let’s go through some of those factors.
China’s Rejection Of Degrees Learned Online
The Chinese Government has decided not to recognise education certification obtained through online learning, so more than 40,000 Chinese students are expected to return for on-campus learning. There will be some well-off students who will opt to buy a unit to live in, instead of renting, while they are studying.
More Expats Returning
After three years of lockdown, China has finally opened its gates, and residents who were in China during that time are expected to return. Opening the gates also has opened doors to Chinese investors looking to invest in properties. Juwai IQI, an Asian real-estate technology firm, forecasts that Chinese investment in Australia’s property market will reach $4.8 billion in 2023, which is double the amount from the previous year. This could drum up competition in the market.
More Australian Permanent Visas Available
The government has boosted the number of permanent visas available for migrants from 160,000 to 195,000 in 2023, to address the shortages in skilled workers and tap into global talent pools. This new batch of people will be looking for a place to settle and further stretch the rental market. High demand for rental spaces could potentially attract investors to buy properties.
If you are looking to buy a house as a worker in Australia on a skilled occupation visa, you may be qualified for the skilled occupation mortgage. We can help you. Call us on 1300 889 743 or fill in our free online assessment form to speak with one of our expert brokers today!
Why Invest Now?
So foreign demand for Australian property is expected to be on the rise in 2023. Here are three reasons why that should encourage you to buy an investment property sooner rather than later:
1. Tight Rental Market
In January, just 0.8% of rental properties were available nationwide. With more people from overseas entering the market, there will be even more demand for places to rent. This would be an excellent opportunity for investors to take advantage of rental yields and earn rental income.
2. Property Prices Have Dropped
Since the peak in April 2022, the national housing value index has dropped 8.9%, CoreLogic data shows. Hobart and Brisbane have the most significant declines among cities. But while prices are still falling, the decline rate has slowed. The decline in house prices already has expats and foreign investors searching the property market for bargains.
3. Competition Is Only Going To Get Tougher
The decline in house prices already has expats and foreign investors searching the property market for bargains.
When foreign investors enter a market, they raise the demand for properties, leading to increased competition among buyers. A more competitive property market would mean higher demand and potentially higher prices. Investing earlier, before this effect has taken hold, means less competition.
Property is currently a buyer’s market, but many experts say the bottom could be nearing. If you have the deposit and the borrowing capacity and can afford the rising interest rates, now may be a good time to invest. The rental market is already tight right now. With more people coming to Australia, there will be even more demand for rental spaces.
We Can Help You!
While house prices have dropped, borrowing costs have increased in the current market situation. This means that people can borrow less now than before. We can help you prepare before submitting applications to lenders and find loans that suit your investment strategy.
We can provide you with a free upfront valuation and credit report so that you can get a good idea of how much you can borrow, and our mortgage experts are seasoned property investors. They can understand factors that influence investors and work according to your plans. We have brokers who specialise in unusual situations, if required, and we’ll be there for you from pre-approval to post-settlement.
Call us on 1300 889 743 or fill in our free online assessment form, and we will contact you.