Australia is such a large area that many people think that there is an endless supply of land.
It is true that there are huge tracts of land all over this land mass that encompasses some 7.7 million sqm, over 30 times that of Britain, however the 22 million population of Australia seem to be fighting over the best pieces of land in the main cities making them not only highly sought after, but also highly profitable.
Each Australian Capital City has averaged in excess of 9%pa growth over the 10 years to March 2006 according to the figures released by the Real Estate Institute of Australia.
However the results are even more attractive in the more sought after locations.
The continuing strength of the Australian Economy which has not fallen into negative growth for over 10 years, has seen the annual wealth of its people consistently rise each year.
As the affluence levels of Australia continue to increase so does the desire to live in the best property, and competition is rising fast.
Another key issue is the fact that Australia’s immigration policy is targeted towards skilled and professional migration and these sector usually comes in fairly cashed up and ready to acquire a premium property as their residence.
In each Australian city, the most desirable suburbs are usually well established near the city such as Mosman in Sydney, Toorak in Melbourne and Dalkeith in Perth and these types of locations usually have no more land available for development.
As a result the only way in is to pay top dollar or miss out and find an inferior but comparable location.
With over 125,000 migrants arriving in Australia each year, time has worked in favour of the existing owners of these suburbs with little or no increase in the supply of property, yet significant increase in the amount of people that want and can afford to live in them.
This situation is only expected to worsen, or improve if you are an owner already, into the future so there seems no end in sight for this phenomenon and astute buyers that can recognize this can look forward to handsome gains in the future.
Compare this with a UK Suburb like Chelsea, many years ago a few hundred thousand pounds sounded excessively expensive for a property there, but the inflow of the wealthy and lack of increased supply of property, has seen prices rise into the millions.
Australia is experiencing the same effect, with one key difference, Quality.
Being a relatively new country, just over 200 years old, most of the properties are still young and benefit from the modern construction techniques and facilities.
As a result, what you get for your money in Australia represents excellent value by international standards.
And then there is the “Heaven” factor. Australia’s cities are still wonderful examples of how living should be. This has proven a wonderful canvas for some of the worlds greatest architects and builders to paint upon and lifted the standard of property as they fully exploited the natural environment on offer.
Unspoilt waterways, beautiful beaches, generous public open spaces all combine with a wonderful climate to truly make this “the Lucky Country” where even though it is getting more and more expensive, you still can live like a king for a fraction of the cost of some of the other international locations.
With a stable and sensible political climate and a strong will to preserve the unique beauty of the cities, the long term out look remains very positive.
As a property owner or investor, the laws and regulations offer great protection and the rental market is strong with occupancy rates in all cities across Australia being around 98%.
And surprisingly, the tax implications of Australian property investment are very favourable to foreign investors with many special incentives on offer by the Federal Government to reduce or in fact eliminate tax on your potential profits.
The ability to write off all interest costs against the property rental, special building write offs and generous depreciation allowances can ensure that annual tax losses can be achieved that carry forward indefinitely to offset future income such as Capital Gains or even salaries if you ever decide to live in Australia.
This can mean that acquiring a wonderful property in Australia, can be a cornerstone of an effective tax plan that could see you living and working in Australia and not having to worry about tax on your income.
In addition, recent changes to Australian retirement income tax policy, can ensure that retirement in Australia can be done without the worry of tax.
Wonderful homes, fantastic locations, steady and consistent growth and the opportunity of a tax free life…sounds like heaven to me.
No wonder they are running out of space.
