As Australia’s shutters went up in March, house prices fell and (some) Sydney first home buyers laughed all the way to the bank. Though properties like Maurice Terzini’s Bondi pad still sold for good prices, others went more cheaply.
But as first home buyers start licking their lips, Eastern Suburbs real estate expert Gavin Rubinstein is here to warn you: this “small window of opportunity for local buyers” will likely only last as long as our borders are “largely closed.”
Once international travel is permitted again, Gavin reckons there could be a surge of competition from overseas buyers, particularly in sought-after areas. So even though you might have expected, as society tightens its collective belt, expensive houses to go for less, the truth is richer areas will probably hold their value better through the next few years.
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As Gavin told DMARGE exclusively: “The Australian dollar is a lot weaker than it was 12 months ago and this presents opportunities for expats and foreign buyers to potentially save 10-15% purely on the foreign exchange.”
“In addition to this, I feel like more than ever, Australia will be viewed as a ‘safe haven’ particularly for Asian buyers who may fear future pandemics impacting their local markets. The way Australia has responded to Covid-19 and how it has mitigated loss of life, I feel, will be seen as another positive for overseas buyers wanting to relocate here in years to come.”
That said, in areas where supply was already starting to lap at demand, and where unemployment rates are highest, Gavin sniffs opportunities.
“I sense there will be a lot of transactional movement in the property market Sydney wide as people readjust to their financial realities. As a result, I think we’ll see a spike in supply in particular areas/postcodes and this where you’ll find better value as a buyer,” Gavin told us.
“Increased supply will put downward pressure on these types of properties and – combined with the low interest rate environment – I feel we are coming up to a prime time for first home buyers going forward.”
More potential good news for Sydney buyers just looking to get a foothold in the market, is that wealthy overseas buyers, when they return, will be looking at “suburbs located close to the CBD, harbour foreshore and top schools” often in excess of AU$4 million.
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“I have found that certain groups of foreign buyers generally like to buy in the same areas that other members of their countrymen have bought in the past and have created mini-communities in those areas (friends of friends, friends of family etc.).”
We then asked if the stereotype that ‘all overseas buyers are rich’ is true, to which Gavin said: “They… tend to target properties in the $4M plus range [unless] they are buying a second property for their kids or other family members.”
“They aren’t necessarily the super-rich, but they tend to be people with more means.”
Your house hunting awaits.