The Immigration Boost and Sydney Property Prices

Today I'd like talk about the return of immigration and its' effect on Sydney property.?

Here’s a five year snapshot of houses and apartments available to rent in Sydney’s Eastern Suburbs.?

In January 2023 there were 76% fewer apartments and 50% fewer houses than were available in June 2020.

And here’s SQM Research’s rent index as at 28th January.?

Rents in Sydney over the past 12 months have increased by 23.9% for units and by 19.9% for houses.

And here’s SQM Research’s weekly?asking price?index as at 31st January.

Sydney?unit?asking?prices are up 4.4% compared to this time last year?whilst?house?asking?prices are 1.7% lower for the same period.

What’s driving this demand, and for units in particular??

For a partial explanation perhaps we can look to Australia’s changing immigration policy.

From early 2022 Home Affairs began?boosting numbers for both permanent and temporary visitor?intakes, and they increased again for 2023.

Here are the official numbers:

(i) Foreign student visas (enrolments) to be issued: 366,500

(ii) PR (permanent resident) visas to be issued: 195,000

(iii) PR partner visas to be issued: uncapped but estimated at 40,500

(iv) Other temporary visas (ie working holiday maker etc) 66,000

(i) refugee/special status: 15,000

2023 total intake 683,000

(Source: Department of Home Affairs)

For the majority of this cohort that choose to live/study/play in Sydney?the affordability sweet spot to both rent and buy property will be around the medians.?

Perhaps it explains the increase particularly for apartment rents and perhaps we might even?speculate that this demand will support/fuel prices for median priced properties into the future.

Some food for thought.