Despite the continued low interest rates in the nation, Australian property remains an attractive prospect for buyers from a number of different nations, particularly those who are coming from the Far East, it has been revealed.
Last week, the Reserve Bank of Australia announced that it would be keeping interest rates at a low of two per cent for the seventh month in succession, even though there had been rumours that this would not be the case as the economy shows signs of improving even further in months to come.
Low interest rates have been one of the main reasons people have cited for the fast price rises for property (often in the double figures on an annual basis) in recent years, with Sydney and Melbourne having been the main culprits for this.
However, even though Commonwealth Bank chief economist Craig James said Australia’s interest rates would stay low for the foreseeable future, potentially seeing purchase prices rise even higher for the next few months, it does not appear to be putting off investors.
ANZ chief economist Warren Hogan said that the current situation in Australia has done nothing to quell demand and appetite for property in Australia among foreign buyers.
One in five sales in the market were from foreigners [earlier this year] which is an extraordinarily high rate,” he said, adding that demand from foreign buyers, particularly those from China and Hong Kong, has remained high over the course of the last few months.
He said that if prices should continue to rise in the same way in Melbourne and Sydney, demand therein may start to fade. However, rather than turning their back on Australia, this will simply lead to a rise in the number of buyers who want to purchase in other cities.
“Both domestic and international investors, they’re continuing looking for value in the next tier of cities, in Brisbane, Adelaide, Perth,” Mr Hogan said.
“I think you’ll even see activity in regional centres - a great example would be places like Cairns which has been very soft for the past 10 years.”
