Australia in Top 10 for real estate investment in 2020

Despite a rough start to 2020, investors in Australia capitalised on the year to become one of the top 10 countries to buy real estate in with inbound investments expected to increase sharply in 2021.

Australia’s rapidly recovering economy and geographic isolation are the main reasons international buyers are interested in the market, according to Savills’ 2021 Global Outlook report. Logistics, build-to-rent and central business district offices are key opportunities for investors “embracing disruption to protect existing portfolios” according to the report.

The findings from a survey of 120 global property investors, managers and family offices places Australia eighth among real estate investment destinations next year.

Top countries picks for international buyers in 2021

Top investment destinations for international buyers
Source: Savills IM 2021 Global Outlook

Of those surveyed 45% expect that real estate investment will increase over the next 12 months, and 25% expect investment levels to stay the same.

Savills global chief executive Alex Jeffrey said the top investment picks for Australia are the logistics sector, repositioning sub-regional shopping centres, CBD offices and filling mezzanine loan space gap.

“Our research shows that real estate investors are confident about 2021, and recent positive announcements about the availability of a vaccine could certainly accelerate the recovery, boost sentiment and help cross-border investments to flow again as more countries in AsiaPacific open up their borders,” Jeffrey said.

“The pandemic has clearly caused multiple disruptions in the economy and the commercial real estate markets. Nevertheless, in seeking new opportunities, investors should embrace the structural trends that have accelerated because of Covid-19.”

Those looking at locations for future investment have also been attracted to the country’s growing regional areas. As we’ve covered, buyers are increasingly looking to regional areas for their new homes, and investors are following. The move away from the CBD to the suburbs is also helping drive house prices upwards (although this growth cannot be solely attributed to investors). 2021 is sure to be an interesting year.

Written: 27 December 2020, Updated: 7 December 2020

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