FROM a distance it may look as if nothing can derail the Australian property market. Australia's median property price rose 22 per cent last year - its best performance in three decades. In fact, there has been a 25-year bull market in capital city property prices.

So it may be tempting for Singapore investors, newly burdened with additional taxes, to dive in now that border closures are being eased. But it would be prudent to scrutinise all the factors playing out in that market.

The biggest single factor is clearly the low interest rate regime that has prevailed since the 2008 Great Financial Crisis. This, coupled with a steady flow of economic migrants, greatly added to housing demand in the capital cities, especially Sydney and Melbourne which account for about half of the national GDP. There is also a shortage of suitable housing land in some areas - the result of local government miscalculation of demand and housing developers' ability to persuade politicians not to release too much housing land that might cause a price correction. Thus, for those with the means, this combination of factors has been a bonanza. Money flowed into the housing market as it was deemed a one-way bet for capital gains. Even the onset of the Covid-19 pandemic did nothing to disrupt the property market.