Chinese buyers are once again snapping up property in Australia, further fuelling resurgent prices in everything from luxury homes to tiny student apartments.
Buyer inquiries from China for Australian properties jumped 127 per cent in the first three months of the year from the final quarter of 2022, according to data from real estate firm Juwai IQI. Real estate agents who work with Chinese buyers predict numbers will surge this year.
“We expect Chinese investment in Australian real estate to climb at least 30 per cent in 2023 from 2022,” said Daniel Ho, co-founder of Juwai IQI, which helps sell foreign property to clients in Asia. “Chinese buyers are back, and more will come in the second half of the year than in the first.”
Luxury housing is of particular interest to Chinese buyers. “The market is fantastic for high-end properties,” said Monika Tu, founder and director of Black Diamondz Group.
That outlook is likely to concern Australian policymakers who are already shocked at the speed of a housing recovery following 11 interest rate increases in a year. Rising rents, limited supply and population growth are driving property markets from Sydney to Perth and a return of big-spending foreign buyers will add to pressure on prices.
Australia is the top destination for Chinese buyers of offshore property – regaining its status following a hiatus when borders were shut for the pandemic and as relations between Beijing and Canberra steadily improve, according to Juwai IQI.
Foreign Investment Review Board data showed China was the single largest source of offshore investment in Australian residential real estate in the fourth quarter of last year at $600 million.
Demand is strongest for three- and four-bedroom houses, said Peter Li, co-founder of Sydney-based Plus Agency which sells new projects, mainly to Chinese investors.
People still want to come to Australia, still want to invest here. Rising rates aren’t a problem, not for international buyers from China.
— Monika Tu, founder, Black Diamondz Group
“We have a lot of Chinese people who are finally coming back to Australia and reuniting with their families,” Mr Li said, referring to people separated during the pandemic. “They are looking to upgrade.”
He said Chinese first home buyers are “still not fully back into the market”.
Australia has long appealed to Chinese buyers as it is in the same time zone and region as the mainland, and has a reputation as a safe and environmentally clean destination.
Mounting tensions between Beijing and Canberra that included China introducing sanctions on some Australian commodities damped the ardour of mainland home buyers for a period. But that seemed to be in the rearview mirror, Mr Ho said.
Chinese demand is likely to strengthen further as more tourists and students travel to Australia in coming months, according to Diana Mousina, deputy chief economist at AMP Capital Markets.
Luxury housing is of particular interest to Chinese buyers. “The market is fantastic for high-end properties,” said Monika Tu, founder and director of Black Diamondz Group, which works with Chinese home buyers who are looking to settle in Australia.
She is selling luxury apartments at Sydney’s harbourside six-star Crown Resort, where the price of a penthouse tops $100 million.
“People still want to come to Australia, still want to invest here. Rising interest rates are not a problem, not for international buyers from China.”
Bloomberg
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