Many people forget that while Australia has been the destination for many expats around the world it has also lost a fair amount of its own population over the years with many off to seek fame and fortune in places as far apart as Singapore and London. However, there are signs that Australian expats are actually starting to move back home in their droves and there may well be some encouraging consequences for the economy and the property market.
Where did they all go to?
As we touched on above, Singapore and the UK have always been very popular destinations for those looking to emigrate from Australia but New Zealand, the US, China and more lately the United Arab Emirates have also been very high on the list of places for Australians to live.
It seems that many have moved for a mixture of the lifestyle, employment with seemingly more and more of late unhappy with the Australian government and the way the country was being run. Many have made the decision that when comparing the likes of the UK and Australia there would be more opportunities in the wider UK employment market and many took the plunge – figures show that around 70,000 were leaving Australia each year and while the majority return to the their homeland it can take some time.
While 70,000 is not a large figure it does add up over the years when you consider that there are only 21 million people in the country. In fact a recent report suggested that of the 21 million people living in Australia around a quarter were actually born overseas.
Why are many considering returning home?
It seems that estate agents in Australia have been inundated with property enquiries for many expats who are now looking to return home. Places such as the UK, the US and China are being hit really hard by the economic downturn and the financial sectors are coming under renewed pressure on an almost daily basis (many Australian expats are involved in the finance industry) causing some to consider where their future lies.
However, this mixture of falling European and American economies has highlighted the fact that the Australian economy has held up better than most and the government is actually starting to shine. Thankfully for those who took the plunge many will be returning to their home land with pockets full of dollars and pounds, both of whose currency’s have taken a pasting over recent times.
This means that they will have more spending power when they convert their savings into Australian dollars and those that had overseas homes (even after the recent falls) will no doubt have done better than the Australian property market over the last decade.
What does this mean for the Australian economy?
While it would be foolish to suggest that the return of thousands of expats will suddenly change the outlook for the Australian economy, it will give it something of a boost. Increased productivity and an increasing confidence in how the government has handled the crisis should see markets pick up fairly soon and a more stable economic environment.
It is also worth remembering that many of those returning home to Australia will have acquired work skills which will be useful to the Australian economy when it picks up, something which could lead to fewer foreigners being granted the right to live in Australia because of the employment skills they bring with them. Even though the medium to long term picture is not yet clear there is a chance that Australia may not require the skills of large amounts of people looking to move to the country, hence a probable fall in the overseas contingent.
How will this all affect the Australian property market?
As we touched on above the number of people looking to returning to Australia is starting to increase markedly. When you consider that many of these are from a financial background, having made there fortunes during the boom times in overseas financial markets, there is significant interest in the higher end of the Australian property market – the area of the market which usually falls furthest in a slowdown.
It is also easy to forget that Australia is a country which is larger in land mass than the UK but has around about a third of the population. This is why the returning expats could actually have a very positive impact upon both the property market and the economy. Those who have maybe over extended themselves with an expensive property will now see the emergence of possible buyers with ‘money to burn’, giving them the opportunity to downgrade their properties and in some cases avoid financial meltdown – while keeping the market moving.
While many of these expats left the country for pastures new because of the state of the government over recent times, the authorities have acted swiftly to nip in the bud any chance of a major Australian economic collapse. This has given investment markets, international investors and the Australian public more confidence in the authorities, something which could prove a turning point if they were to continue this into the future.
The ongoing impact of the returning expats should not be under estimated as it can and probably will have a large impact on some of the more secluded and expensive dwellings in the main cities of Australia. This in turn will keep the property market rolling, reduce the downwards pressure on the economy and possibly see the country emerge from the worldwide economic slowdown quicker and in better shape than most.
While for many years we have seen places such as the UK, the US and Singapore cherry picking the best employees for the financial markets it looks as though this trend has now turned full circle. Many Australian expats will be returning home with a large increase in their savings to show for their time away and the chance to improve their lifestyle yet further in Australia.