Overseas property: Dream homes down underPosted on: 16 May 2012 by Laura Henderson
Laura Henderson says Australian property market offers limitless opportunity for second homers.
Celebrities from Harry Potter star, Daniel Radcliffe to soul legend, Diana Ross have been drawn to the huge spaces, vibrant cities and beaches in Australia – so what does the Oz property market have to offer aspiring investors?
Long lambasted for its crocodile chasing, barbecue loving, lifestyle, of all locations across the globe, Australia has successfully broken free from its one-trick ‘laid-back’ label in proving it has so much more to offer. And while the land down under is still as relaxed as ever, the options for property buying are nigh on limitless when it comes to choosing a place to live.
Historically, the Australian real estate scene has been fairly predictable, with six to eight year cycles of steady growth, followed by a plateau or slight decline in values. All this changed in the 1980s, when the country witnessed unprecedented capital growth, followed by a substantial correction with a soft residential market through to the mid-1990s. By the late 1990s, the Australian economy was strong, with record low-interest rates and unstable equity markets.
Like most global locations, the recession has hit the country hard. That said, the Real Institute of Australia confirms that Brits remain key investors in the property market as the third-largest group of foreign owners. “The property market here isn’t as stressed as the likes of Spain and Greece and the US,” explains Brisbane-based property consultant, Mark Davies. “Having said that, it has suffered a slowdown in sales volumes and price reductions from the heady pre-crunch days. At the moment there are pockets of negativity that buyers can work to their advantage. You can talk down the price. You can haggle quite hard especially if you are coming in with your financing in place or as a cash buyer.” So where are the biggest markets now for Brits?
Former Australian PM Paul Keating once described Sydney as the only place in Oz to live, famously quipping: “The rest is camping out.” Despite that rather disparaging opinion, all the main cities have developed their own distinct property markets in the past decade. Despite recent criticism that the city is getting too big for its boots, Sydney does have it all. The glitzy party-loving heart of modern Oz and the country’s biggest metropolis boasts a dazzling if slightly over-cooked harbour and a cosmopolitan melting pot of fine restaurants and nightlife. Away from the laid-on attractions, iconic monuments like the Opera House and Sydney Bridge are hard to overlook.
Sydney is also Australia’s most expensive city for residential property. Best buys are in areas that have a growing population, are well serviced by infrastructure and are attracting investment from both developers and government. The inner and coastal suburbs have increased markedly in value in recent times, whereas the western suburbs have seen less growth and in some cases values have fallen.
Queensland’s lifestyle and affordability of homes attracts several thousand British buyers a year, making it one of the fastest growing states in the country, with a population of over 4m, of which 20+% of newcomers in the past two years have come from overseas. Brisbane, the capital, boasts bright sunny days and balmy nights, with average summer temperatures between 21 and 29 degrees. The city has a café culture to it, its architecture a melting pot of glass skyscrapers and period sandstone buildings. Those keen on a holiday pad may well like the outlying districts of Beenleigh and Beaudesert, and also Bribie Island, between Brisbane and the Sunshine Coast.
South of Brisbane lies the Gold Coast, a stretch of 35 magical golden beaches considered the playground of Australia. It you want a prime beachfront location and subtropical sunshine, then this is the place to be. While decent properties under £300,000 are getting harder to find, good investments can still be made. The coast boasts surfing Meccas like Greenmount Beach and Kirra, targeted by developers. “The area remains one of Australia’s top sailing destinations,” says local agent Tim Holmes. “Riverfront developments which offer private berth facilities are increasingly sought-after.”
Hark back to the past; the present prosperity of Melbourne hasn’t always been there. Founded in 1835 from a tract of land acquired from the aboriginals, it was the gold rushes of the 1850s that brought in the riches and the masses and paved the way for a bullion boom. Downtown, the city presents contrasts: the stark minimalism of the skyscrapers jostling for space with the elegant and ornate Victorian edifices.
The city offers a sophisticated lifestyle with a European feel, a growing combination of great art, culture, wilderness (on the outskirts), and fabulous shopping. “What’s good about Melbourne is the property peaks and troughs aren’t as marked as other urban hubs,” explains Davies. “A significant factor underpinning strong housing demand is its fast-growing population. It’s one of Australia’s most expensive locations for residential property, although prices have tended to lag behind those in Sydney in recent years.”
Laura Henderson is a property expert, columnist and author specialising in overseas investment markets. Her latest book Tricks and Mortar: The Little Book of Property Wisdom is out now on Amazon.
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