There’s been a lot of talk about how Asian capital is driving the Australian property markets
Well, according to Credit Suisse, Chinese buyers bought $8.7 billion in Australian residential property in 2013-14, or about 15% of new homes, and the number is growing fast.
Most of the purchases are concentrated in Sydney, where Chinese buyers are snapping up the equivalent of 23% of new supply, and Melbourne 20%.
Credit Suisse expects $60 billion in purchases by Chinese buyers over the next six years, more than double the $28 billion over the last six and in a note to clients said:
“We think Chinese demand is having an influence on property prices in both cities (Melbourne and Sydney)
Even though housing supply has increased over the last year or so, Chinese demand has risen by more.”
This surge in housing investment is driving demand higher and new home sales are at their highest level since early 2010 and the action is in apartments.
Multi-unit sales rose 11.3% in March compared to a more modest 2.6% increase in detached houses, according to the Housing Industry Association.
The federal government has new fees for foreigners wanting Australian property and has started to crack down on breaches.
At the same time the Victorian government is adding a further stamp duty when the buyer is not a resident of Australia.
If you’d like more details read what I’ve written about the Foreign Investor crackdown.