Concerning figures show eye watering amount Aussies spent on property

Aussies spent an eye-watering amount on property last year, but with international borders opening in less than two weeks, there are more warnings.

Aussies’ frenzied buying and selling on the property market last year added up to a third of the country’s national economy, with a whopping $688.7 billion spent on homes.

As home values surged by more than 20 per cent in some parts of the nation – rising at their fastest rate in three decades – data showed there was a 57 per cent jump in housing settlements equalling one-third of Australia’s $2 trillion economy.

The figures from conveyancing platform PEXA showed property transaction soared to more than 834,000 last year in NSW, QLD, Victoria, WA and SA, up by 38 per cent compared to 2020.

Skyrocketing property prices have also seen the Australian market reach a value of $9 trillion, but have also shone the spotlight on housing affordability and how younger generations are being locked out of buying.

834,000 homes were bought and sold last year. Picture: David Swift/NCA NewsWire

While there have been predictions the property market will experience a serious drop from midway through this year, with 2023 house prices predicted to plunge by a whopping 11 per cent, according to a NAB, other experts aren’t so sure.

Scott Butterworth, the chief data and analytics office of PEXA Insights, said records had been busted while international borders had been closed.

“We’ve had record volumes at a time when migration flows have been basically zero, so what happens when those borders are reopened?” he told the Australian Financial Review.

Apartments could become more sought after. Picture: David Swift/NCA NewsWire

Buyers agent Michelle May also predicted the reopening of international borders on February 21 will see the return of student and skilled labour immigration and as a result, apartments being sold and rented in inner cities again.

“Whilst lockdowns spurred an increase in tree and sea changes over the past couple of years, in 2022 I’m predicting we’ll see a reverse of that. Many apartments which have been sitting idle as they were marketed to skilled labour immigration and students, will now be snapped up again with our borders opening,” she added.

“As we see the population increase again, we will see more buzz around the apartment market, especially in university areas.”

Buyers agent Michelle May. Picture: Richard Dobson

Generally skilled labour immigrants tend to chose apartments that have good access to public transport, schooling and general amenities, she said.

“Affordability certainly plays a factor in this in particular, as well as a typical higher level of acceptance for apartment living from overseas immigrants,” she noted.

Despite January being a typically slow month for property sales, PEXA shows markets are still going gangbusters.

Victorian settlements reached more than 17,344 last month up by 12.7 per cent compared to last year, NSW saw gains of up to 10.6 per cent to 17,163, while Queensland jumped 9.8 per cent to 16,943.

Surprisingly, the Sunshine State was the biggest winner when it came to property in 2021 with transactions surging by 40.8 per cent to total 232,824 transactions, while NSW racked up 228,657 and Victoria reaching 220,495 settlements.