Fresh figures from the Foreign Investment Review Board have revealed a massive increase in the number of Australian homes purchased by foreign investors.
While the FIRB report found that the number of investment approvals in other sectors of the economy were “broadly unchanged”, the real estate sector had “a significant increase” in approvals with 37,347 approvals in 2014-15, compared with 23,428 approvals in 2013-14.
The FIRB report highlighted that current approvals are “more than triple the levels of 2012-13”.
“The majority of this increase related to new dwellings approvals. This is consistent with the government’s policy to increase the housing stock by channelling foreign investment into new dwellings,” the report said.
Charles Pittar, CEO of Chinese international property website Juwai.com, said approved Chinese investment in real estate doubled to AU$24 billion in the 2014-2015 financial year.
“China's share has risen from less than one-tenth to more than one-quarter of all of foreign real estate investment in Australia since 2012,” Mr Pittar said.
"Anyone who bought a new apartment last year should probably thank a Chinese offshore buyer. Because Chinese are more likely to buy off the plan and give developers the reassurance they need to start construction. New dwelling approvals have been well above their long-run average at least since 2015,” he said.
“China’s immense pent-up demand for international property is driving this trend. There will be ups and downs, without a doubt, but the long-term trend is up.”
Mr Pittar said this is important as it shows that the “China bears” who claimed Chinese investment was falling off a cliff are badly informed.
“Australia is the second most popular country for Chinese buyers, after the USA and ahead of Canada and the UK,” he said.
“Chinese buyers are investing in residential property, commercial property and development sites.
“Chinese developers are building some of the most interesting projects in the country right now, and making a direct contribution to employment, housing supply and economic vitality.”