2020 survey foreshadowed the property price growth that lay ahead and investors believe prices will keep rising this time, according to the 2021 PIPA Annual Investor Sentiment Survey.
The national annual survey gathered insights from nearly 800 property investors and found that more than 76% of investors believe property prices will increase from 41% last year.
The 2021 PIPA Annual Investor Sentiment Survey
PIPA Chairman Peter Koulizos said people believed the positive investor sentiment in last year’s survey, even though history showed the resilience of real estate time and time again.
“When we think back to 2020, it’s clear that investors and the market in general has weathered that turbulent period better than anyone had anticipated,” Mr Koulizos said.
“Property Investment Professionals of Australia’s survey forecast the strong property price growth that we have since experienced, it’s just that not many people believed us at the time.”
PIPA envisions this as a good time to invest
This year’s survey found that nearly 62% of investors believe that now is a good time to invest in residential property, which is down from 67% in 2020, and may be due to the high property price growth this year as well as significant lockdowns taking place at the time of the survey.
21% of respondents, up from 17% in 2020, say the pandemic made them consider moving to another location with the reasons being improved lifestyle factors, 78% same as last year, will work from home in the future and housing affordability, 36% down from 40% last year.
However, 25% of respondents said their motivations to move included not wanting to live in crowded cities and wanting to live somewhere with fewer coronavirus cases and lockdowns.
The sunshine state is the property winner
Mr Koulizos said this year’s survey produced the biggest ever margin when it came to the property investment location that investors believe offers the best potential over the next year.
“Queensland is certainly a winner in a serious way, 58% believe that Sunshine State offers the best property investment prospects over the next year up from 36% last year” Mr Koulizos said.
“NSW was second at 16%, down from 21% and Victoria was third at 10%, down from 27%.”
The number of investors who see Brisbane as the state capital with the best investment prospects has soared compared to last year’s results, up to 54% compared to 36% in 2020.
Mr Koulizos said Queensland was beneficiary of billions dollars of infrastructure projects that are set to transport the region, Brisbane was recently named host of 2032 Olympic Games.
“The affordability of property in Southeast Queensland and strong interstate migration, are the reasons why investors are so optimistic about the market conditions,” he said.
Mr Koulizos said a buying trend that began in last year’s survey appeared to be gathering momentum, with investors looking more outside metropolitan markets.
The Property Investment Professionals of Australia survey found nearly 50% of investors say metropolitan markets offer the best investment prospects, down from 61% last year.
Regional markets’ interest has continued to gain in favor with 25% of investors, up from 22%, while interest in coastal locations has soared to 21% from 12% last year.
However, while investors remain upbeat about market conditions, about 29% of them say the pandemic made it less likely they will buy a property in the next year up from 21% last year.
Fewer property owners are looking to sell
The lingering impacts of the pandemic and the robust price growth means fewer investors are looking to sell a property this year at 59%, compared to 71% of respondents last year.
“Part of the reason for the uplift in property prices over the past year has been the continued low levels of supply in most locations around the nation,” Mr Koulizos said.
“With a decrease in the number of investors indicating they intend to sell over the short-term, it seems unlikely that this boom market cycle is going to change anytime soon.”
Investors are seeking qualified advisers
One important result in the survey was the fact that about 92% of investors believe that any provider of property investment advice should have completed formal training or education.
“When markets are running hot it is more important than ever that buyers work with qualified property investment experts. Unfortunately, there is no legal requirement for people to have any training before calling themselves a property investment adviser,” Mr Koulizos said.
“Whether looking for a qualified adviser, mortgage broker, accountant or any professional involved in the property investment process, a Qualified Property Investment Adviser or the QPIA logo is the best assurance when dealing with a trusted and educated professional.”