Confidence in Australia’s property sector has bounced to its highest level since March 2018, according to the latest ANZ/Property Council survey.
The property industry shows signs of gearing up for a strong economic recovery in 2022, with the Confidence Index rising 12 points nationally in the December 2021 quarter.
There were substantial confidence boosts in the ACT, Victoria and NSW, as those jurisdictions reopened from COVID-19 lockdowns.
Confidence Index (source: ANZ/Property Council)
“These results show the industry is clearly optimistic about the state of the economy and commercial and residential property markets in the year ahead, having emerged from the challenges COVID-impacted last two years,” said Property Council of Australia Chief Executive Ken Morrison.
“It’s very clear that our members’ forward work expectations have lifted, and as a result they’re also expecting to hire more people to deliver that work.”
Confidence Index by jurisdiction (source: ANZ/Property Council)
The survey was undertaken in November and showed future work expectations lifted in every state and territory except for WA.
Future work expectations in the ACT jumped from 27 to 67 index points, while Victoria rose from 26 to 47 index points.
ANZ senior economist Felicity Emmett said while the lift in commercial property sentiment was broadly based, the largest gains were in the sectors hardest hit by the pandemic.
Forward work schedule expectations (source: ANZ/Property Council)
“The reopening of state borders and easing of quarantine restrictions is clearly boosting confidence in the tourism property sector, while the rise in office occupancy has boosted sentiment in the office sector,” Emmett said.
“Industrial property remains a clear winner through the pandemic though, with the shift to e-commerce lifting demand for warehousing and logistics property.”
The Q4 2021 survey had 859 respondents drawn from across the property industry, including property developers, managers and agents and service providers.
Construction activity expectations by sector (source: ANZ/Property Council)
The positive outlook comes as new CBRE research showed foreign investment into Australia’s commercial property sector hit a new annual record of $16.6 billion in 2021 in spite of international border closures.
North American investors led the charge, accounting for about 39% of total foreign investment this year.
Singaporean investors were the second most active purchaser group this year, representing 35% of this year’s activity.