There has been a recent increase in the number of Australian expats engaging the services of a buyer’s agent.
The rising market sees the return of expat buyers
In keeping with historical trends, over 80% of the expat demand has been centred on Australia’s most expensive housing markets, being Sydney and Melbourne. However, many offshore buyers are interested in southeast Queensland and other parts of Australia too.
A primary driver of this has been the rebound in housing prices which began to rise again towards the end of 2020, leading expats to fear losing the opportunity to gain a foothold in the Australian housing market.
While both Sydney and Melbourne have been top performers, housing prices have increased across the whole country in 2021, underscoring the fear of missing out from buyers currently based overseas.
Impacts of the current travel restrictions increase demand for buyer’s agents
It has also become impossible for most expats to travel in and out of the country due to the prevailing travel restrictions. Since the beginning of the pandemic, around 500,000 Australians have returned home, according to Advance.org. This represents close to half of the expat community.
Despite a moderate recent increase, total arrivals into Australia are only a fraction of the usual numbers. As such, unless expats want to buy sight unseen, which is risky, there has been a growing demand for professional assistance from buyer’s agents.
A shortage of stock
A third factor has been the unusual nature of the property market in 2021, with property listings more than 25% below what might be expected for this time of year. Again, this trend is not restricted to one capital city or territory – the shortage of stock and new listings has been a feature of markets all around the country.
Considerations for expats and the ‘race for space’
Typically expat buyers need to factor in financing arrangements, currency movements, and any tax implications of being overseas. However, the recent developments in Hong Kong have also shown that political factors can also play a role in the plans of expats.
While many expats live in units and higher-density developments in Asia or other parts of the world, this is not the property type in favour by buyers in Australia at present, with a ‘race for space’ seeing housing market demand shift towards detached houses.
While Australia is seen to be an expensive country, many expats are based in some of the world’s most expensive cities for real estate, such as New York, London, Singapore, or Hong Kong. As such, expats with an open mind can buy a detached house in parts of Australia for the equivalent price of a unit or flat in their current location.
Expats need to factor in all of their own personal reasons for buying – whether they are buying a block of land where they can build their forever home in the future, to gain a toehold in the Australian market, or purely as an investment play.
In all cases, engaging a trusted and experienced buyer’s agent with local knowledge and strong negotiation skills can provide peace of mind, saving expat buyers time, cost, and stress, while professional due diligence significantly reduces the risk in the transaction.