The past decade has seen a dramatic increase of international students in Australia. And of course this has bolstered certain segments of our property market in the past.
But things are changing…
Australia is are currently the world’ s single biggest foreign educator of Chinese students and the booming Chinese economy and the emergence of more wealthy people in China suggests this trend is likely to continue
Here is a breakdown of the top 10 countries sending us their students.
1. China 147,319
2. India 64,202
3. Korea 26,849
4. Vietnam 22,103
5. Malaysia 22,097
6. Thailand 18,829
7. Nepal 16,059
8. Brazil 12,392
9. Saudi 10,747
10. USA 9,861
But the numbers are plummeting
Interest in Australia as a destination has been plummeting since 2008, a result of the high Australian dollar, visa rule changes, negative media coverage following a spate of bashings of Indian students, and increased competition from the US, UK and Canada.
NSW and Victoria, which between them attract two thirds of international students coming to Australia. The NSW economy benefited from overseas students to the tune of $6.5 billion in 2010, while they pumped $5.5bn into the Victorian economy.
But with falling student numbers and an oversupply of new inner city apartments in Melbourne’s inner CBD, where many overseas students traditionally rent, I’m concerned that vacancy rates will rise above 4% in Melbourne’s CBD over the next year and CBD apartment prices will fall.
I’ve never considered off the plan or new inner CBD apartments a good investment and the current situation explains why – they are too dependent upon a narrow demographic of tenants.
I’d rather have my investment properties appeal to a wider range of tenants