Singaporean investors have increasingly moved to fill the gaps in Australia’s property landscape left by the recent exodus of Chinese foreign investment.
Singapore has outpaced China as Australia’s number one source of foreign real estate investment.
According to a new report by Juwai IQI, Singaporean investors have acquired $19.3 billion in local real estate over the past two years.
This put them several billion dollars ahead of Chinese entities, who accounted for just $13.2 billion of investment over the same window.
“Most big Chinese corporate investors have pulled back from Australia, while those from Singapore have doubled down on the lucky country,” said Juwai IQI executive chairman Georg Chmiel.
On the whole, Chinese investment in Australian real estate is down from its previous high of 26 per cent of overall investment in 2015-2016 to just 13 per cent in 2019-2020.
While China remains the largest investor in aggregate over the last decade, Singapore now leads the pack with approximately 17 per cent of annual foreign real estate investment in Australia.
“Singaporean real estate investment has climbed significantly, while China’s has fallen,” Mr Chmiel said.
Describing Australia as a “big backyard for many Singaporeans”, Mr Chmiel said that this influx of investment is being led by larger players like Singapore’s GIC wealth fund.
Singaporean foreign investment in Australian real estate has grown rapidly in recent years, going from $5 billion in 2016 to $8 billion in 2017, and $9 billion in the two years following that.
“For retirees, second home buyers, families with school and university age children, and property investors, Australia is an obvious destination,” Mr Chmiel noted.
The report also highlighted a split between China and Singapore in terms of the kinds of foreign investors each country is bringing to Australia.
Where China is weighted towards individual buyers of residential property, Singapore favours large-scale investments in commercial property and development.
“The pandemic has put a halt to most travel back and forth, but it hasn’t choked off real estate investing,” Mr Chmiel commented.
More broadly, the report rated Singapore as the third-largest source of foreign investment in Australia — not just for real estate but overall.
“Just like many Australian businesses consider Asia to be a natural market for their products, many Asians consider Australian real estate the natural destinations for their money,” Mr Chmiel said.