The Governments tougher restrictions on foreign investment seems to have had little effect on overseas buyers purchasing Australian property.
The latest NAB Quarterly Australian Residential Property Survey found while foreign buyers were less active in new property markets, they had increased their presence in established markets, especially in Victoria.
The percentage of foreign buyers in the new property market dropped from 15.6 per cent to 12.8 per cent in the past quarter but in the established property market the number of foreign buyers had increased to 8.6 per cent from 7.5 per cent at the start of the year.
NAB Group chief economist Alan Oster said foreign buyers accounted for more than one in ten sales in both Victoria and NSW.
Units were more appealing to foreign buyers, accounting for 16.1 per cent of all apartment sales nationally in the second quarter of the year.
Foreign buyers were behind 28 per cent of all new apartment purchases in Victoria and 16.5 per cent in New South Wales.
How much did they pay?
More than three quarters of foreign investors bought apartments valued at less than $1 million, with 41% of those priced below $500,000.
More than 16% of all apartment sales were in the $1 million to $2 million price range, with a much higher percentage of these in New South Wales where they were responsible for one in four purchases at that price and almost 12 per cent for more than $2 million.
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'Foreign Investment Continues To Surge' have 4 comments
July 30, 2015 George
Clearly Asians are illegally laundering their money in our property market. And its affecting battling Australian first home buyers every day. These foreign investors dont care if they make a profit or not and obviously care not about the effects of our crashing dollar on the value of their investment. The FIB penalties in this respect where any profits from the forced sale are confiscated obviously are not an issue/deterrent for foreign investors. For the law to be effective it should be TOTAL confiscation of illegal investment as it is with any other crime. And it should be closely policed with headline news any time an illegal foreign investor is cleaned out. No better deterrent than publicising the law in action. Now that would also be a great way politically, to help pull back our budget deficit!!! From my point of view we should have reciprical investment rules. After all isn’t that what a free trade agreement is all about? Presently our Asian neighbours can freely (illegally) invest in our properly market with nothing to fear but you must be a Chinese national to buy or hold Chinese property. This is a total farce and it needs to be not only stopped but put into reverse gear. The figures do not relect reality. Almost every auction you go to has numerous foreign (Asian) investors or thier representatives bidding. The last one in my street 2 weeks ago had 4 bidders of which 3 were Asians. They may not be buying every property but they sure are responsible for bidding up prices to ridiculous figures.
July 30, 2015 Michael Yardney
George – as always you have some extreme views, which I don’t really agree with, but thanks for going to the trouble of commenting
July 29, 2015 Marc
“The percentage of foreign buyers in the new property market dropped … but in the established property market the number of foreign buyers had increased to 8.6 per cent from 7.5 per cent at the start of the year.”
I was under the impression foreigners are not allowed to purchase existing (second hand) property and FIRB approval is always required. The quote from the article above makes it sound like foreigners can and do buy established property in Australia? What have I missed here?
July 29, 2015 Michael Yardney
Marc, in general you are correct, but there are some exceptions http://www.firb.gov.au/content/real_estate/real_estate.asp