- Many expats have returned over the past year due to the pandemic
- They bring back wealth, often in currencies stronger than the Australian dollar
- Local buyers have had to compete with cashed-up expats
The Property Investment Professionals of Australia (PIPA) has said that with hundreds of thousands of Australians returning home over the past year amid the pandemic, many expats have returned with ‘new money’ that has flooded the housing market.
PIPA’s Chairman, Peter Koulizos, remarked that many of these expats return with significant wealth – including in currencies that are stronger than the Australian dollar, supercharging their buying power.
Mr Kouzlizos said that given many Australian expats come from expensive cities such London, New York and Hong Kong – the latter of which is the most expensive city in the world – some buyers don’t necessarily consider our booming real estate prices as ‘unaffordable’ and are willing to pay a premium in securing prestigious property in desired locations.
“Our members report that some of the sale prices being achieved in Sydney, for example, seem insane – even in booming market conditions – with new money or the expat factor the likely reason.”
“Indeed, some properties are selling for hundreds of thousands of dollars more than what anyone – including experts – had predicted, which is leaving sellers very happy, but many buyers and property investment professionals scratching their heads somewhat.”
Peter Koulizos, PIPA Chairman
Mr Koulizos added that Brisbane, Adelaide and various regional areas are also recording sales price growth due to this “new money” from more expensive locations interstate.
Cate Bakos, the President of the Real Estate Buyers Agent Association (REBAA), said expats were having a strong impact on the Melbourne market. However, local buyers remained competitive, particular those whose financial circumstances improved during the pandemic.
“Cashed-up expats are certainly contributing to some of our silly runaway prices in Victoria, but we also have a lot of bottled-up energy from local buyers, too, particularly those who have managed to save during Covid,” said Ms Bakos.
Ms Bakos added that buyers agents are typically sought out by expats – although she remarked that, nevertheless, many expat buyers also cannot keep up with the increase in house prices.
“At the higher price points, and specifically in the family home markets, expats are represented by a reasonable share of buyers for certain.”
“Buyers’ agents are definitely privy to this, given expats are a cohort who typically do reach out for professional assistance, but it is fair to say that many expats are struggling to keep up with and accept the sheer pace of our market growth at present.”
Cate Bakos, REBAA President