FIRB: Chinese buyers double down on Australian property
Chinese appetite for property in Australia shows no sign of waning after buyers doubled investment in the nation's homes and offices for a second straight year.
Spending on Australian residential and commercial real estate rose to $24.3 billion in the 12 months ended June 30, up from $12.4 billion a year earlier and $5.9 billion in 2013, according to the Foreign Investment Review Board's annual report.
All Chinese investors in a survey conducted by KPMG and the University of Sydney want to allocate more money to Australia, a separate report showed on Monday.
Real estate is fuelling the capital flowing from the world's second largest economy, which last year overtook the US as Australia's largest foreign investor.
"Overall we are seeing a strong story of Chinese investment into Australia's broader economy which is in line with premium products, services and lifestyle-oriented themes," Doug Ferguson, head of KPMG Australia's Asia and international markets and co-author of the report, said in a statement.
Purchases by foreigners, many with a connection to China, helped drive an almost 55 per cent jump in home prices across Australia's capital cities in the past seven years as mortgage rates dropped to five-decade lows.
The rising demand has triggered community concern that locals are being priced out of the property market, prompting the government to tighten scrutiny of foreign investment.
China also stepped up administrative measures in January to slow the flight of capital that Bloomberg Intelligence estimates reached $US1 trillion last year as the yuan was devalued and Chinese equities tumbled.
Total foreign investment into Australia climbed 17 per cent to $194.6 billion in financial 2015 from $167.4 billion the previous year, with spending under $50 million comprising about a fifth of the total, according to FIRB.
An "overwhelming majority" of such deals relate to real estate, with residential property approvals surging 60 per cent over the period, it said.
The US remains the second largest foreign investor in Australia after pumping in $25.1 billion during the period, up 44 per cent from a year earlier.
Source Credit: Bloomberg