The recent property market surge was largely driven by housing supply issues and now as our international borders begin to open again, fresh demand could surge prices once again.
Market listings have started to pick up in recent times, slowing the booming market but things look set to bounce again as overseas and interstate arrivals look for somewhere to stay or somewhere to buy.
“It’s going to have a big impact because we’re going to see tourism reappearing and short-term accommodation,” Real Estate Institute of Australia president Adrian Kelly told Mortgage Professional Australia.
“We’re going to have overseas students back and they all need somewhere to live.
“We’re going to have migration starting again and they’ll all need somewhere to live – not forgetting we’ve got all those expat Australians who have been living overseas.
“They’ve just been waiting to get a seat on a flight, and they’ll all be coming home as well.”
Demand for property from Australian expats has already been red-hot as they wait to be allowed back in the country, with some desperate enough to buy without actually seeing their property.
Mr Kelly said all that was about to change.
“This will change things because the majority of people prefer to touch and feel a property before they spend their money,” he said.
On the flipside, however, is the fact that as Australians start holidaying overseas again they’re expected to have less disposable income left over to spend on property, putting downward pressure on prices.
“We know that the high savings rate was one of the reasons that has driven the rapid price growth,” Ray White’s Nerida Conisbee told the Australian Financial Review.
“Now that people can travel, I think it will lead to less savings and this will impact the amount people can spend to buy a home and potentially impact demand.”
Adrian Kelly says there’s plenty going on in the market right now with different aspects at play at once so will be watching things closely to see how it all plays out over the coming months.
“With increased demand from borders reopening, how does that correlate with an increase in new listings coming on the market?” he told MPA Magazine.
“We don’t know the answer yet. It’s just a matter of watching to see how that part of the market plays out.
“2022 is still going to see very, very strong market conditions.”