Australia has been and is projected to remain as the most stable property investment market for many years to come. Even when the ordinary market swings are factored, the market still offers great prospects in the long term. The resilience of the Australian property market is aided by key drivers that have ensured that it remains on an upward trend even as other markets struggle with declining property investment prices.
The now easing Global Financial Crisis (GFC) is an indicator of the stability in the Australian property investment market. In the heat of the economic meltdown when most of the world economic giants' property markets were collapsing one after the other, the Australian market held on steadily. In fact, there was hardly any shock felt in the market. The next 12 months after the GFC when the international property investment registered almost zero growth rates, the Australian market recorded impressive capital growth. The question in the minds of most property owners as well as potential property investment owners is what is the future like for the Australian property market? For how long can the positive growth be sustained?
To answer this question satisfactorily, you first have to look at the government policy which plays a major role in the performance of the property investment market of a nation. At the height of the global economic crisis, the Australian government took serious steps to cushion the property market against the kind of collapse that was witnessed in USA. First it introduced new incentives in order to boost property investment demand. For instance, the First Homer Owners Grant was floated. Later, the government ordered a review of the foreign property ownership laws. Following the review, the laws were greatly relaxed, making it extremely easy for overseas investors to own property investment in Australia. These two measures were amazingly successful. In fact, the government had to later review the foreign investment policy for the second time to reduce the influx of foreign investors!
Employment plays a major role in the demand for housing and property investment. The Australian unemployment rate is very low compared to major economies of the world. At the same time, its GDP has been on an upward trend for the last couple of years. Earlier this year, IMF analysts predicted that the Australian economy will grow at a rate of over 3.5% in 2011. This has been given a shot on the arm by the massive demand of core and iron by China and other consumers.
Another crucial factor is population growth. The Australian population is expected to maintain a steady growth of about 2% per year. This is massive population growth. It is much higher than China and even than the US. With this kind of population explosion, demand for housing is expected to triple the current standings. In short, whereas the rest of the world market stares at an uncertain future, the Australian property investment prospects look glowing for many years to come.
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