NAB has released its Quarterly Australian Residential Property Survey which revealed a big jump in foreign demand for Australian property.
According to the survey, overall property market sentiment was unchanged in September at +19 points, with stronger house price expectations offset by weaker rental prospects. Moreover, sentiment in Western Australia plummeted to its lowest level on record (-39 points).
According to NAB, foreign demand for Australian property boomed in the September quarter, with both pre-existing and new developments experiencing increases. Foreigners reportedly accounted for 8% of buyers of pre-existing dwellings (despite rules being in place to prevent such sales), whereas they accounted for a whopping 17% of new property sales (see next chart).
Victoria has become the mecca for foreign investment, accounting for 25% of new property sales (presumably CBD apartments) and nearly 12% of pre-existing dwellings (see below charts).
House price growth is also expected to cool over the next two years, led by Sydney and Melbourne (see next chart).
