In a much closer race than the polls predicted, Joe Biden has won the U.S. election and is set to become the next U.S. president in 2021. With vote counting in key battleground states taking several days, it's been a turbulent time. 

The predicted ‘blue wave’, where the Democrats would hold control of the House and Senate, hasn’t eventuated, so any serious reform agenda from the Democrats is unlikely to gain momentum. The Democrats are likely to have a small majority in the House and the Republicans are likely to have a small majority in the Senate, which will create a stalemate. This could derail any big plans such as Biden’s tax policy and may mean things will remain ‘business as usual’ politically and economically. 

So, what will change for Australia, if anything?

Relations with China may be impacted 

What we may see is an impact on the foreign policy front, most notably in regard to the delicate balance of power between China and the U.S. 

The U.S. relationship with China has significant economic impacts for the rest of the globe. While Australia has its own relationship with China which has been increasingly strained of late, escalating tensions between the U.S. and China could exacerbate the problem, especially if Australia is forced to take sides. 

Trump hasn’t shied away from provoking China. The trade war between China and the U.S has a global fallout; most recently impacting Australia through tariffs on barley and sanctions on beef and cotton. Australia’s calls for an independent inquiry into the origins of the COVID-19 outbreak - an apparent show of strength and loyalty with the U.S. - were met with the Chinese Government warning its students against studying in Australia. 

Any mounting tensions between China and the U.S. could embolden Australia to take further steps to further alienate China. That could have serious economic ramifications including a deepening of already declining Chinese investment in Australia, including investment in housing. On the flip side, however, politically it may become increasingly important to stand up to China on certain issues, for example the current situation in Hong Kong.

Biden is likely to remain firm on China but will engage with international partners through a more collaborative response. Australia is likely to be influenced by the American stance on China going forward. 

We may see an increase in Americans mitigating to Australia 
 
If the U.S. election has revealed anything, it's that the nation is deeply divided. The U.S. is experiencing a period of significant unrest as a result of COVID-19, fractured race relations and political partisanship. Whatever the result of the election, this could be enough to encourage many Americans to leave. 

Australia is a highly attractive destination for people from all over the world. People in America, South Africa, the UK and Hong Kong, among others, are likely to be drawn to Australia. All are currently experiencing forms of cultural, racial or political unrest, and may wish to relocate somewhere more stable. 

Australia has an excellent track record on containing COVID-19, enjoys political stability and has fared much better than most countries economically throughout the pandemic. Let’s not also forget we have a great lifestyle and weather compared to many other places. It is reasonable to expect that once our borders open there will be growing interest from Americans, and others, to migrate here. 

In fact, it appears that many Americans may be making plans already, with reports that US searches for Australian property are outperforming every other country outside of Australia, jumping 32% compared to the same time last year. In New York, search in Australia has more than doubled.

An increase in migration from the U.S. would have a positive impact on our economy as it would help offset the drop in population growth we’ve experienced as a result of COVID-19 related border closures. Our economy relies on population growth to create demand for goods and services. This would also have an impact on our property markets, with more demand for housing likely to lead to higher property values.