Whilst battling against COVID-19 is a continuing saga with more twists and turns than an Agatha Christie novel, three significant milestones have happened recently. Firstly, the Centers for Disease Control in the United States declared that those who have received both doses of a COVID-19 vaccine can ditch face masks when out and about, and feel much more at ease about their safety. In the same week, the European Union urged member nations to begin making plans for open borders and the free travel of people in the near future, as the vaccine rollout escalates across the continent. And while our vaccination plan has been hit by its fair share of issues, extra Pfizer doses are on the way with the Australian Medical Association now saying that every Australian who wants to be vaccinated could be by the end of the year.
This may have huge implications for Sydney and, particularly, its property market because we could be on the verge of seeing extraordinary population growth delivered via a new migration wave.
Hopefully, Australia’s international borders will re-open sooner rather than later, and when they do, overseas migration will resume.
The unprecedented decision last year at the start of the pandemic to shut the nation’s borders to anyone except citizens and permanent residents, and immediately suspend the immigration program, appears to have been a necessary one. It has proven the most effective measure to prevent devastating infection numbers and death tolls like much of the rest of the world has seen.
But the inability for anyone to enter Australia, either as residents or future citizens, has come at some cost.
Immigration is about much more than being welcoming to those who wish to permanently call Australia home. It is vital for our future prosperity, stability and security. Population growth is a major factor in the country’s economic growth. Immigration makes up two-thirds of our rising population. Any dramatic slumps in the number of people heading here, either for an extended period or permanently, is not good for the economy.
Broadly speaking, it doesn’t matter who you are, where you live or what you do, the longer the borders stay shut, the worse off we will be. There’s the impact on vital export markets, such as the international student sector, which is worth billions of dollars. There’s the inability to plug skills shortages, from farm workers to mining specialists and doctors. And the fewer people there are, the less consumption there is meaning fewer products sold, fewer services bought and less money washing around the economy.
This is why more and more conversations are being held with key decisionmakers about how Australia can begin to emerge from its global isolation. The pressure is on to do it safely, but quickly.
It is not just tourism operators and airlines that are pushing authorities to make a concrete plan to reopen Australia to the world. Although, they’re certainly loud voices at the table. A number of industries and lobby groups, as well as foreign governments, are asking for signs of progress. And there is some.
There is talk of establishing ‘immigration bubbles’ to bring in workers from select countries to help labour markets that are struggling with shortages. There is also talk of how international students can be welcomed back in a way that will be safe, efficient and not prohibitively expensive.
More broadly and importantly, Treasury is starting to talk about reopening and implementing a migration program that tackles the new challenges posed by COVID. The vaccine rollout is speeding up the pace at which these conversations are being had. Rates of new infections and deaths in hard-hit nations like the UK and the US are falling. Europe is getting on top of its third waves. Confidence is growing that the jab is doing what it was meant to although there may be new obstacles such as the delta variant of the virus.
As this continues, the time when borders are brought down and people can move about the world with ease looms closer.
…And the Winner is…
And when Australia is reopened for business, there’s one city that migrants will flock to.
Sydney is well-placed to hold on to its mantel as the new hometown of choice for those who come here from abroad. It is not just the stunning Harbour, famous beaches, glittering night life and sense of style that make it a hot destination.
The state’s economy is robust and standing up to COVID admirably. The mix of industries is broad enough to future-proof growth from post-pandemic jitters and speed bumps. It has several world-class universities. Investment in technology and entrepreneurship by the government is high. Infrastructure spending is making the city a better and more prosperous place to live. And it’s the most recognisable and alluring place for global businesses to visit, meet, trade and expand.
What this means for property buyers in Sydney now is that current high demand in the market has a long tail ahead. The insatiable appetite for housing is not going anywhere. The resumption of migration with Sydney taking the lion’s share of new arrivals will mean that the housing market is likely to remain resilient and buoyant well into the future.