Investors in the Asia-Pacific region are the most confident in the world about property investment conditions, with Australia leading the region, according to a global investor sentiment survey.
The 2015 Colliers International Global Investor Sentiment Survey has found sustained levels of strong economic growth and improving global conditions are the primary factors contributing to high levels of confidence among Asia-Pacific investors.
The survey found 60% of investors expected conditions to continue to improve compared to 35% last year. Just 7% expected a deterioration of conditions.
“With such high levels of confidence, the outlook for investment volumes is, not surprisingly, also positive,” John Marasco, Colliers International Managing Director of Capital Markets & Investment Services, said.
”Year to date, investment volumes in Australia were slightly higher than the same time last year, with $19.8billion transacted across all asset classes compared to $17.7billion in 2013.”
CBD office space continues to be the preferred property investment product among Pacific investors for the next 12 months (39%), although not as dominant as last year (57%).
Residential property investment came in second (36%), which alongside Developments (29%) has seen a significant increase in interest since last year, reflecting the improving housing market.
Nerida Conisbee, Colliers International National Director of Research, said very few respondents (5%) planned to reduce or sell their investments, with the main reason cited for doing this being the ability to reinvest profits later or elsewhere in real estate.
“The guiding principles for property investment remain consistent with last year. Property fundamentals remain the most important, followed by economic growth and then yield. Interestingly, given the focus on depreciation of the Australian dollar, this is considered to be one of the least important considerations.”
Not surprisingly, the city in which Pacific investors prefer to invest is Sydney (58%). This was followed by Brisbane (44%) and then Melbourne (43%). Compared to previous surveys, Conisbee said such strong interest in Brisbane was a new trend, likely reflecting the higher yields currently being achieved in this market.