Amid a fresh wave of interest, Hong Kong and mainland Chinese buyers are making significant investments in the Australian property market, aiming to fast-track homeownership for their children studying or working in the country.
Over the past decade, these buyers have consistently been the largest group of investors in Australian real estate.
Surge of Australian Property Market
Recent data from the Foreign Investment Review Board reveals a resurgence, with buyers utilising funds accumulated during the pandemic.
Plus Agency, specialising in investors from Hong Kong and mainland China, reported an unusually high volume of transactions during the recent holidays.
The agency’s Sydney-based general manager, Peter Li, noted the atypical activity, stating, “Normally, I’m on holiday at this time of the year, but I’m at the office now at 8 pm processing paperwork for these transactions.”
Major Block of Property Buyers
Buyers from mainland China and Hong Kong represent the largest single group of investors in Australian assets, accounting for almost A$150 billion over the past decade, comprising 21% of all purchases by foreign investors.
Visiting cities like Sydney, Melbourne, and Brisbane, Chinese parents are actively participating in property transactions to assist their children in securing homes.
The rebound in property prices, with an 8.1% increase last year after a brief retreat in 2022, has further motivated these investments.
Real estate experts highlight Australia’s inherent desirability, stable government, and lifestyle that includes favourable weather and air quality as key factors attracting international buyers.
Sydney-based luxury property agent Ken Jacobs remarked, “It is the inherent desirability of the location and attributes of the property which are underscored by a stable record of capital gains.”
Despite recent government measures to triple application fees on foreign purchases and impose penalties for vacant homes, the high demand, coupled with a shortage of listings, has kept home prices at elevated levels.
Prime Minister Anthony Albanese’s “Build to Rent” program aims to address this shortage by attracting foreign investors to contribute to the supply of affordable housing.
Industry insiders, including Daniel Ho, co-founder and managing director at Juwai IQI, note a shift in mindset among mainland Chinese and Hong Kong buyers.
These investors, considered more conservative, tend to make purchases after their children secure permanent residency in Australia.
Ho predicts sustained demand in 2024, with prices likely to remain high or experience a slight increase.
