In a recent seminar in Ho Chi Minh City, Deborah Wiltshire, Sales Director at The Gurner Group, revealed exciting insights into foreign investment trends in Australia’s booming real estate market. According to data from Australia’s Foreign Investment Review Board, foreigners acquired 5,360 residential properties totaling approximately A$4.9 billion (US$3.1 billion) in 2022-23, with Vietnamese investors showing a notable increase in activity.
The appetite for Australian properties among Vietnamese investors has surged, with purchases rising by 15% during the same period. Vietnamese nationals accounted for 8-10% of off-the-plan apartment acquisitions, highlighting a growing trend in this critical market segment.
Data from Victoria, the top destination for Vietnamese international students in 2024, indicates that sales to Vietnamese buyers have jumped by 10-12% year-on-year. Notably, properties priced between US$800,000 and $1.2 million have emerged as the most sought-after options among these investors.
A report from CBRE, a leading property consultancy, outlines that 60% of Vietnamese purchases aim to provide accommodation and educational opportunities, while 30% are for investment purposes and 10% cater to migration needs. The city of Melbourne stands out as a prime hotspot due to its urbanization, robust economy, and rich cultural diversity.
With over one million international student enrollments recorded last year, Melbourne attracts students mainly from China, India, Nepal, the Philippines, and Vietnam. This influx has positioned the city as the fastest-growing capital in Australia, promising further development opportunities.
Michael Paproth, Business Manager at The Gurner Group, noted that Australia’s population is projected to grow by 1.8% annually over the next five years, outpacing growth in established economies like Canada and the U.S. However, he also warned that housing development is struggling to keep up with demand, predicting a shortage of approximately 28,000 apartments in the coming years.
As restrictions limit foreign buyers from acquiring existing properties, off-the-plan purchases attract a relatively low tax rate of 10%, especially when compared to markets like Singapore, which imposes significantly higher rates.
Notably, Vietnam is witnessing a steady rise in its high-net-worth population, with around 5,500 individuals boasting a net worth exceeding US$10 million as of 2024. This growth, estimated at 5-18% annually prior to the pandemic, and 2.4-5% post-COVID, fuels demand for overseas properties, including those in Australia.
The intensified interest from Vietnamese investors not only signals a promising shift in foreign investment dynamics but also reflects evolving consumer trends that could reshape Australia’s retail and property landscapes. As consumer preferences evolve, retail businesses may look to adapt and align with this growing demand for international investment opportunities.
