A Shift in Demographic Trends
There are many great ways in which the property market may get affected due to the net interstate migration being witnessed of late. Pete Wargent, in an article for the website Property Update, talks about certain demographic trends.
The mining bust has coincided with a boom in Sydney’s fortunes. The population migration from Sydney has been countered by this mining bust.
Undersupply and property scarcity
An element of property scarcity is being witnessed in certain areas where undersupply has become a norm rather than a temporary thing. Buying properties in such areas can offer lucrative capital gains.
Overseas buyer rush
In the inner city and CBD areas, foreign buyer rush has led to an oversupply kind of situation; something which in course of time will bring in the demons of poor rental yields and high vacancy rates, warns Wargent. This said, the use of foreign investors cannot be overlooked. To explain, the domestic buyers know that they can get a better deal out of established properties and thus they choose such existing properties above the new constructions a lot of times.
The foreign buyers, on the other hand, have regulations in place for them which allow them to buy only newly constructed properties. Thus, these offshore buyers are the ones who will have to push the “new construction” boat.
Already, supply imbalances in Sydney has been staring at us and now population migration only seems to have made the case for “demand outstripping supply” stronger.
You can read the original article here.
Adding skilled work force through net interstate migration
I think that we need to emphasise on the migration of skilled work force in no uncertain terms. These are the individuals who will add to the impetus of the labour and construction industry. What the unskilled work force might add to the net interstate migration dilemma, the skilled work force is likely to compensate through their value addition. Here is looking forward to interesting times ahead!
How do you see the population rise affecting Australian economy?