Expats force up property prices in key destinations

Expats are, it seems, bumping up property prices around the world, according to recent media reports. In recent weeks, the press has been full of stories about how people relocating from their own countries are forcing up rental and home prices in various major expat hubs. The Indonesian island of Bali is one such location. A perennial favourite with international tourists drawn for its beaches and vibrant nightlife, Bali is rapidly becoming a hot sellers’ market thanks to “the pandemic, changes in working styles, and a new second-home visa scheme,” according to Insider. Bali welcomed 371,504 foreign visitors in the first half of 2022, as per the Central Statistics Bureau of Bali. In contrast, there were only 51 foreign visitors for the whole of 2021. And as life starts to go back to normal, the island’s property market is heating up. Many of the homes – and new building developments to cope with soaring demand – are being snapped up by Americans, Hong Kongers, and Singaporeans. The effect, say locals, is that in general terms property prices are soaring as the typically wealthier expats can outbid domestic demand.

Mexico

Meanwhile, on the other side of the world (almost), there are similar stories coming out of Mexico. Major news outlet CNN reports on a family watched in the capital and on the community around them that has changed. An influx of foreigners, mostly from the U.S., inspired Mexican landlords to renovate and remodel their properties to accommodate the wealthier arrivals. “Prices are much higher,” the mother of the family noted. “It’s difficult because a lot of these foreigners come, and they have a bunch of money to be able to spend on these apartments and rents.” The U.S. State Department says 1.6 million US citizens live in Mexico. But it doesn’t know how many are living and working there on tourist visas, reports CNN. The Mexican government does not track that data either, but it recorded more than 5.3 million American tourists flying into Mexican airports from January to May 2022. “That’s nearly a million more compared with that same period in 2019.”

Singapore

Singapore – already known as one of the world’s most expensive places to live – is also becoming increasingly unaffordable for many Singaporeans. The reason, many claim, is the surge in expats relocating to the city state. Much of the influx is from Hong Kongers who are keen to move to another Asian financial hub to escape the harsh Covid rules and lockdowns and the growing influence of Beijing. Rental rates for high-end accommodation are likely to continue moving upwards through early next year, analysts say, albeit at a slower pace. Savills, the real estate company, said rents in about two-thirds of the cities monitored, including Singapore, have already recovered to their respective pre-pandemic levels as expatriates crowd back into Asia’s recovering urban hubs. “International tenant demand has been fundamental in the return to growth,” it said. “Prime rents have only returned to pre-pandemic levels in half of the Asia Pacific cities we monitor.”

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