Experts debunk 'myth' that Chinese buyers drive up Australian property prices - The Straits Times

SYDNEY – For years, Australians have blamed soaring property prices on an influx of cashed-up Chinese property buyers.

A survey in July, for instance, found that 73 per cent of Australians believed that “foreign buyers from China drive up Australian housing prices”, with only 8 per cent believing that Chinese buyers do not add to prices and 19 per cent expressing a neutral view.

Carried out by the Australia-China Relations Institute at the University of Technology Sydney, the survey also found that 78 per cent of Australians believe the amount of Chinese investment in residential real estate should be restricted, with 8 per cent disagreeing and 14 per cent expressing neutrality.

But it turns out that Chinese investment has had little to no effect on Australia’s decades-long property boom.

A new study published in June in the journal Housing Studies examined how Beijing’s 2017 crackdown on money leaving China had affected property prices in each of Sydney’s 678 suburbs.

Eighteen months after the crackdown, which led to a fall in overall Chinese investment in Australia, restrictions had caused prices to drop by 3 per cent in areas with Chinese communities, but had no impact on property prices elsewhere.

Associate Professor Song Shi from the University of Technology Sydney, co-author of the study, said the impact of Chinese investors in Australia has been “much less – and less widespread – than many Australians think”.

“Our findings… suggest ongoing concerns about Chinese capital and Chinese investors driving up Australian home prices and exacerbating affordability problems are overstated,” he wrote last Monday in The Conversation, a website that publishes research and analyses by academics.

Other researchers had similar findings.

Dr Mona Chung, the director of consulting firm Cross Culture International, who in 2017 conducted a study of the impact of Chinese investment in Australia, said perceptions of Chinese buyers driving up Australian property prices is a “media myth” that dates back decades.

She said the myth emerged as China grew wealthier and its citizens were able to afford to buy property in Australia.

“You had no Chinese buying houses in Australia, and then you had pockets of Chinese buying in areas in Sydney and Melbourne – they became more noticeable,” she told The Straits Times.

“People often look for a cause of blame for why they can’t do something (such as buy a house).”

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