![Bernard Salt](/images/Bernard_Salt_197x128.jpg)
One of the nation’s leading demographers, Bernard Salt, has revealed what’s really driving Australian property and how buyer preferences are changing.
Speaking exclusively to The Adviser, the KPMG partner said there are two components to the “theme” of Chinese property buyers, which continues to be a hot topic of discussion.
“The one component is someone who is based in China and they simply want an investment over here. But I think there is another component, a significant component,” he said, pointing to the ethnic composition of migration to Australia.
“These are people who are permanent residents. People of Chinese origin are comprising an increasing component of the population and therefore will have a particular style requirement.”
According to Mr Salt, Chinese residents are after brick homes with good security that are a reasonable distance to the CBD and close to amenities.
“Which is often a very different taste to middle-class Anglo preference,” he said, “which might be weatherboard Edwardian, Victorian high-maintenance properties. Two very different mindsets.”
While population growth has slowed, Mr Salt remains bullish about the Australian property market, where he sees growth opportunities in middle suburbia within a five to 15 kilometre radius of the Sydney and Melbourne CBDs.
“Middle suburbia [is] generally [a] larger block, [with] more generous houses,” he said. “I think there are opportunities there to rethink the value of the property. That might mean unit development, more intensive development, or building a property that effectively appeals to Chinese buyers.”
Mr Salt is an optimist when it comes to Australia and firmly dismisses talk of a property bubble. Negative views of the property market are rife, he said, but have little truth behind them.
“When do you ever pick up the paper and read of a positive view of the Australian economy or property market? There is never a positive view. In fact, if you acted on the advice you would never buy property, you would never invest in property. And yet in fact you would have missed the greatest boom for the last 25 years and the peak of that boom from 2008 through to 2013 or so.”
Mr Salt said Australians need to take a “bigger picture view” and argues that we are a young, vibrant country with strong levels of population growth, very aspirational, and we’re rich in terms of income per capita.
“We are as rich as the Americans, some say even more so depending on how you measure it. We are more egalitarian. Our cities are more attractive places to live. We are an overnight flight away from China,” he said.
“There is no reason why we wouldn’t be a prosperous people in 10 or 15 years’ time. There is no reason why people wouldn’t be spending more on property in the future.”
Mr Salt will be giving a keynote speech at The Adviser’s 2016 Better Business Summit. The impact of Chinese buyers and the continued strength of the Australian economy will be central themes.
“My main theme would be the continued strong growth of the Australian economy and Australian population growth,” he said. “I will also need to talk about the impact of China and Chinese investors.”
The Adviser’s Better Business Summit, in conjunction with The Adviser’s Better Business Awards, will be held in Brisbane on 18 February, Melbourne on 25 February, Sydney on 3 March, Adelaide on 11 March and Perth on 17 March.
Click here for more information.
[Related: National summit engages brokers near and far]