Chinese not overpaying for property: report

Chinese not overpaying for property: report

19 May 2014 by Andrew Jennings 0 comments

There’s little evidence that Chinese buyers pay more than other buyers for real estate in Sydney, according to a new study.

The University of Technology report, Chinese Demand for Sydney Residential Property, which analysed 74,000 individual home sales over a 10-year period showed that Chinese buyers paid two per cent less than other buyers on average over the decade, even after taking into account characteristics such as housing quality, suburb and date of purchase.

That represents a saving of $13,800 on the average price of $676,300 for the properties in the study.

The research also revealed a significant increase in the proportion of sales to Chinese buyers over the decade, with 6.5 per cent of sales to Chinese buyers in 2000 increasing to 13 per cent in 2010, which dropped to 10 per cent in 2011.

The study found no evidence that Chinese buyers, who are said to drive the hardest bargains when it comes to property purchases, pay more than other buyers when sampling by year, or after separating the sample into Chinese versus non-Chinese populated suburbs and prestige versus non-prestige suburbs.

Researcher at the University of Technology Lorenzo Casa­vecchia, who has sent his findings to a parliamentary inquiry, said the implication of the findings is that Chinese buyers, on average, do not seem to overpay for houses, as some commentary suggests.

“On the contrary, we find evidence that Chinese buyers pay less than other buyers for similar-quality homes,” said the report.  

Researchers said they plan to conduct a more comprehensive study using the full sample of all Sydney home sales from 2000 to 2013, which will provide better insights into the overall size of the discount paid by Chinese buyers.

promoted content
Recommended by Spike Native Network
Listen to other installment of the Real Estate Business Podcast
reb top 100 agents 2016

With a combined sales volume of $13 billion in 2016, the Top 100 Agents ranking represents the very best sales agents in Australia. Find out what sets them apart and learn their secrets to success.

featured podcast

featured podcast
William Phillips on how agents can expand their database and grow their business

In this episode of Secrets of the Top 100 Agents, host Tim Neary is joined again by William Phillips to discuss the real estate database and...

View all podcasts

Are dodgy agents being punished enough?

Yes (8.6%)
No (55%)
Only in some states (2.3%)
Not all dodgy agents are being found out (34.1%)

Total votes: 220
The voting for this poll has ended on: April 15, 2017
upcoming events
REB Awards
Sydney The Event Centre 12 Sep
REB Awards
Sydney The Event Centre 12 Sep
Melbourne The Event Centre 14 Oct
Brisbane The Event Centre 18 Dec
View all events
Do you have an industry update?