Melbourne is officially the most popular Australian city for Chinese buyers of residential real estate, according to the latest data from Juwai.com, a Chinese-language international property website.
More than 40% of inquiries about Australian residential property made on Juwai.com during the first seven months of 2017 were for Melbourne, up from 35.6% in 2016. By contrast, Sydney, the second most favoured Aussie city by Chinese investors, drew only 17.5% of inquiries this year, a tiny increase from last year’s 17.2%.
“Melbourne is actually receiving more buyer inquiries now than it was one year ago,” said Jane Lu, head of Australia for Juwai.com. “In the first half, Melbourne received 13.3% more buyer inquiries than it did in the first half last year. That’s even faster than the global rate of growth of 8.7%. Melbourne certainly beats Australia as a whole, with inquiries nationally down 9.7% in the first half, compared to a year ago.”
Overall, Chinese interest in Australian real estate remains strong despite the increasing restrictions imposed by both the Chinese and Australian governments. Last month, Beijing included overseas property investment in its list of restricted investments, and the Victorian and federal governments have imposed significant levies on foreign buyers of residential property.
According to Lu, there is likely to be “no let-up” in Chinese demand for international real estate. “Chinese buyers feel that international and, in particular, Australian real estate is one of the more safe and wise investments they can make,” she said.
Australia offers good value compared to the price of similar real estate in mainland China, and the Victorian government’s levies have had little impact on lifestyle and educational buyers.
“There is no lack of Chinese demand. Despite tighter capital controls, 57% of Chinese investors told Financial Times researches that they will increase their overseas investments over the next two years, with more than 60% planning to invest specifically in residential real estate. Chinese investors' top goals are risk diversification and their children’s education. These push factors provide an underlying strength to demand in Melbourne.”
The fact that there is still a great deal of Chinese activity in the Australian property market goes to show that buyers still have the money and the means to meet these transactions.
“Chinese investors are aware of Victoria’s stamp duty and that figures into the calculations that investment-oriented buyers make,” Lu said. “It doesn’t have much impact on lifestyle and education buyers. We expect Chinese buyer demand to make 2017 one of the two or three biggest years on record in Australia.”
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