Ongoing enthusiasm for Australian property will see wealthy Asian investors continuing to buy up large in future – although their market preference looks set to change.

Newly-released international property investment research, conducted for HBSC, found that Australia is one of the favourite property investment markets for affluent Asians.

Currently the number one destination for offshore property investment among wealthy Indonesians, Australia was also a close second for Malaysians and Singaporeans.

Australia also ranked highly among investors from China, Hong Kong and India.

HSBC Australia head of mortgages Alice Del Vecchio said Australia's appeal lay in its proximity [to Asia], quality education and lifestyle.

Community links to Asian countries also played a part, she said. “Close to 70% of Australia's international students are from Asia and many stay in Australia long term to work or reside.”

This interest in Australia was expected to remain strong, which would benefit the economy as foreign investment activity was a stimulus and could help to support a rebalance away from the mining sector.

Traditionally, wealthy Asian investors have gravitated towards the property markets of Sydney and Melbourne.

However, Del Vecchio said HSBC’s research indicated that was changing, with a noticeable shift to the smaller property markets of Queensland and ACT.

Queensland was the choice of 25% of Asian investors planning to buy in the next year. This was followed by ACT with 23%, Victoria with 20%, NSW with 18%, and WA with 16%.

The high house prices of Sydney and Melbourne, which rose by 13% and 12% respectively over the last year, were likely to be a major reason for this shift.

Del Vecchio said cities like Brisbane – where house prices lifted by just 3.8% over the last year – now provided investors with a better entry point into the Australian property market.

“Access to universities, holiday homes in Queensland and the large public service sector in Canberra may also be a drawcard.”