The number of overseas buyers, particularly the Chinese market, is growing in the Australian investment property market. In fact, Australia is now second only to the USA in terms of popularity among Chinese people looking to buy homes overseas.
Indeed, the pace even looks like hotting up even further and the number of Asian investors is predicted to worth around $44 billion in the next few years (up from $24 million over the last seven years).
Credit Suisse equities strategist, Hans Tevfik explains, “A lack of momentum in Chinese property means that the Australian housing market is likely to become even more attractive in the short term.”
Australian investment property prices are rising
A number of economic data forecasts indicate that the Chinese home market has been sliding downwards for some time while Australian investment property prices continue to escalate, albeit not as quickly in recent times. Even so, low interest rates ensure demand is still ahead of supply as the flood of eager buyers from Asia continues unabated.
How will that affect Sydney residents? Hans continues, “Residents in Sydney and Melbourne are understanding that the rules of property prices are changing and should expect even more demand for local real estate from Chinese investors as they look for a stable store of wealth. Globally desirable cities, like the major ones in Australia will always be destinations for foreign capital.”
The Chinese like to buy, not borrow
According to Florence Chong, writing in The Australian, for the Chinese there’s more to this enthusiasm for buying property than wealth creation: “Historically, Chinese people like to own property. There is a cultural attitude to owning your own, not borrowing or leasing it.” She surmises that they aren’t following a trend – “it’s a tradition.”
Still a safe place to invest
Whatever the reasons, there is no doubt that the long-term growth of the Australian property market looks buoyant and will continue to be attractive to buyers both at home and overseas.
Regardless of the economic predictions espoused by politicians, an Aussie investment property, especially in one of the capital cities, still looks a sound place to put your money.