Chinese overtake US buyers as biggest investors in Australian property
Chinese buyers have overtaken Americans to become the biggest investors in Australian property, drawn by the nation's strengthening housing market, as their government tightens rules on buying at home.
Chinese investment in Australian residential and commercial real estate surged 42 per cent to A$5.9 billion (HK$41 billion), compared with an 85 per cent slump to A$4.4 billion in purchases by US buyers, according to an annual investment update from the Foreign Investment Review Board (FIRB) on its website.
Home prices in Sydney and Melbourne, the most popular cities for Chinese property investors, rose 13.4 per cent and 11.9 per cent respectively in the year ending January 31, according to the RP Data Home Value Index. Chinese buyers are flocking to overseas markets to escape government measures to rein in escalating home prices, including restrictions on buying more than one home and higher capital gains taxes.
"Chinese buyers are a rising tide," said Andrew Wilson, senior economist at Sydney-based real estate data company Australian Property Monitors. "We'll continue to see a lift in Chinese investment into this country as the Australian dollar continues to fall and as residential property continues to strengthen."
At least 10 Chinese cities, many of them provincial capitals, have tightened local property prices since November, with big population centres such as Shenzhen, Shanghai and Guangzhou raising the minimum down payments on second homes.
Overseas investment in the Australian housing market fell to A$17.2 billion from A$19.7 billion a year earlier. In commercial real estate, it slid 12 per cent to A$34.8 billion.
Total foreign investment in Australia fell to A$135.7 billion in the 12 months ending June 30, the FIRB report showed. The real estate and mineral exploration and development industries were the biggest recipients.