Covid related Population Exodus and property markets

SMH is reporting that 34,200 Australian residents have permanently left Australia between June 2020 and May 2021.

This trend is now accelerating very rapidly as more and more people are calling time on Australia and moving overseas in order to resume normal lives.

Current uncertainty around a clear path out of this pandemic will surely aggravate this ongoing loss, basically empty planes are landing in Sydney and Melbourne everyday to take full loads out of the country.

I reckon this will have disastrous impact on our property markets particularly Sydney and Melbourne. Sure new immigrants will likely start in 1-2 years but new immigrants aren’t able to enter property markets right away.

Australia COVID: Immigrants give up waiting for Australian border to open after coronavirus closures

Views?

 

The article doesn't seem to cover the numbers of people coming in. Do you know what those are? I thought we had queues of those.

 

Well 35,000 Australians returned home in just December 2020 alone.
So...
No I don't think this is a big factor.

Australians continue to return home

 

Most likely migration will resume once we open up again. If there is a fall in property prices before then? Thats just backtracking a few months of gains. But there isnt much indication of this esp for above median houses. Anyone remember the 15% fall in 2017-2018?

this situation looked worse during the lockdowns last year, with no obvious path out, and what happened to property prices?

Why would you think new migrants wont buy property right away? Look at property prices where the migrants are probably coming from. Often from cultures that prize property ownership.

also arent there numbers like a couple hundred k australians who have returned since covid started?

long term its still looking good imho.

 

Those returning home are a small fraction of Australians leaving the country. Even by September last year, Australian population had dropped to the lowest since World war 2. Current census will likely show a significant population drop when the results come out.
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“In the three months to September last year, 55,400 people left Australia, while 20,600 arrived — turning net overseas migration negative by 34,800 people.”

Why is our population shrinking? Wasn't there meant to be a COVID baby boom?

 

It takes a new immigrant on average 5 years to enter the property market and 7 years for those arriving as students/temporary visitors.

A three year immigration loss and population exodus will create a hole in housing demand that will take a very long time to fill.. it will particularly hit apartments market really hard as they are already in oversupply with a shrinking population.

 

So dont buy apartments. Apartments havent done well recently. Cloudier long term outlook for highrises.

For those who have been in the market for a while, if the market falls just refi and buy more houses.
Tougher decision for newbies, tho long term still think buying is better than not buying.

Seriously, not worried. Not so much thinking it cant fall, but think it will rise in the long term and short term falls dont matter. Low rates, low lvr and no margin calls.

how did you feel in 2018?

 

Well why does that ABS release say otherwise? What's going on here?

 

Op, what response are you looking for? People to say lets sell everything and hide?

lets say property falls 20%. So what? Are you thinking it will just keep falling long term? That it will be flat for a decade? That happened in the 2000s, and who remembers that now?

Having been through the gfc, and the recent covid market, i’ve just decided i’m not smart enough to predict the short term and just close my eyes and invest for the long term.

 

I don’t think they are wrong .. there is a difference between visitors and those indicating long term stay/exits on their entry/exit cards.

 

Disastrous impact? Nah. Not even close.

 

Looking at the ABS release, the net migration is still positive on nearly every measure though, from what I can tell - admittedly I'm not full bottle on what the definitions are there.

But even on the abc article, the apparent net migration out seems pretty insignificant and temporary.

 

The key being temporary.

unless long term population is falling, short and medium term falls are just buying opportunities.

buy for the grandkids.

 

Sydney and Melbourne to put in 20% next year.
Even more the year after as the necessary immigration program ramps up and helicopter drop money continues

 

I think a lot of people are using the reason of permanent relocation to get an exemption to leave the country because they want to visit and care for sick relatives etc. But they will be back. Our borders are meant to be opening when the vaccination rate hits 80% and that is forecast to be at the end of this year. So maybe another 5 months of madness to go and then things will calm down.

I don’t think it will affect the property market at all.

 

I wonder if those people you speak of, left Australia to visit sick family members / friends in Delta ravaged countries, and then returned to Australia, being Delta positive, and went into quarantine only to have it escape.
I wouldn't be getting my hopes up about borders opening anytime soon. Many hospitalisations and deaths still occurring right across the globe!

 

Why would you think they could or want to ? Buying a house is not priority They are often in debt when they arrive. Have migration agents fees to pay, education fees to pay air fares to pay, sometimes it takes years of savings to get there family here. They dont know if or where they will be permanently , have training to pay instead of getting paid, have probationary periods to pass, than need a period of permanent work to qualify for a loan. They are often transient and need to familiarize themselves with different locations. All the ones I know wait until they become citizens they say it is easier and they have certainity and more confidence , then still take years after that when they pull the trigger as they find it isnt as easy as you may think to get the time, finance or conviction to buy

 

"Big property sales are still being recorded in the Sydney, Melbourne and Canberra markets despite increasingly onerous lockdowns, while the rest of the country powers on with high prices and conversion rates."

Pandemic property sales defy odds with strong results in all markets

 

12 month rolling population growth by state.

The issue isn't just that people are leaving, its that people aren't arriving. In 2019 net overseas migration was +248,000 people. In 2020 it was 3,250.

Here is rolling 12-month population growth per state up to December 2020. it includes interstate and overseas migration, as well as natural increase. Australia had 250,000 fewer residents than expected in 2020, and the same policies are continuing through 2021 (data not yet available). If it persists through 2022+, you do the math on what you expect Australia's population deficit to be, considering that dwelling approvals are surging back to all time highs. To say Australia is not heading for oversupply is absolutely foolish. Question is, where. IMO all signs point to Melbourne.

 

Agree to this from my personal experience. There are a lot of hurdles to jump through from career wise and then to get to the permanent residency which takes 3-4 years. Most banks refused to give a credit card in 2009 despite being a professional with a good income and history of banking many years in Europe.
Some are leaving for good. Pandemic have opened the eyes of some that home is better than anywhere else when it comes to death and also frustration when you cant be with your loved ones.

https://www.reddit.com/r/australia/comments/ntbfwa/skilled_migrants_leaving_australia_for_good_to/