Auction activity rises – but are clearance rates following suit?
It’s been the busiest week for auctions since the Easter long weekend, with 2,847 homes going under the hammer represe...
Investor behaviour has not been spared from the changes and disruptions wrought by COVID-19.
A new study by MCG Quantity Surveyors shows that remote and borderless investing had been supercharged by the pandemic, with buyers realising that if they want to stay in the game, they need to be prepared to take a risk on a property sight-unseen.
Along with that has come a willingness to buy further afield. The report showed that property investors have “doubled the distance” between where they live and where they invest in response to the pandemic.
The data revealed the average distance between a landlord’s home and their investment property had risen from 294 kilometres to 559 kilometres over the pandemic period.
Moreover, buyers investing in locations more than 200 kilometres from home rose from 29.5 per cent in January 2020 to 44.65 per cent in November 2021.
Mike Mortlock, managing director of MCG Quantity Surveyors, credited a growing comfort with using technology to facilitate property purchases as a major contributor to the shift in behaviour.
“Technology makes it possible to buy property from the comfort of a locked-down home. Modern day investors see the whole of Australia as a potential market – not just their state or city,” Mr Mortlock said.
He added that the tide of city dwellers moving to coastal and regional areas had also been a factor in making certain areas more attractive to investors, regardless of the proximity to their own homes.
“The surging popularity of regional relocation in this remote working world has boosted those property markets. Capital growth rates in many regional centres rivalled big cities in 2021, and investors want to get a piece of this action,” he said.
Queensland was apparently the primary beneficiary of this behavioural shift, with 37.44 per cent of the investors polled for the study buying in the sunshine state. NSW came in second with 34.31 per cent. Victoria captured 11.31 per cent of the investor pool, while the rest of Australia made up the remaining 15.94 per cent.
Mr Mortlock said it remains to be seen if this rate of remote investing would be sustained as borders reopen and investors return to their normal routines.
“While the figures might come back a little, I suspect the world has changed for good and long-distance buying is well and truly established. There’s little evidence we’ll see percentages returning to pre-pandemic levels anytime soon,” he said.