Christina Zhou| ABC| 21 August 2017
Australia is losing Chinese buyer interest to other parts of the world as tougher government regulations and new tax rules continue to bite, new data shows.
Top 10 countries for Chinese property buyers in 2017
- United States
- United Kingdom
- New Zealand
Chinese inquiries in Australian residential property was down 9.7 per cent in the first half of the year compared to the same period in 2016, Chinese international property portal Juwai.com figures reveal.
The median inquiry price also fell from about $394,000 to about $350,000.
At the same time, inquiries from around the world — including Thailand, Japan and Malaysia — grew 8.7 per cent.
The data comes as Chinese regulators formalised new guidelines restricting Chinese corporate investment overseas, that include real estate being placed on a ‘restricted’ list, which could further compound a drop-off in new developments in the Australian property market.
The Australian head of Juwai.com, Jane Lu, said Chinese buyers were still adjusting to the new regulatory and tax rules in Australia, which remained the second-most popular country in the world for investment.
“Their top goals are risk diversification and their children’s education. Australia is a very appealing destination in both these areas,” she said.
“The fact that we still have so much Chinese real estate buying in Australia shows that they still have the money. When you compare the price of similar property in China and Australia, Australia still offers good value.”
The Victorian Government axed the stamp duty concession for off-the-plan investors from July 1 and more than doubled the foreign-buyer stamp duty surcharge from 3 to 7 per cent in 2016.
NSW doubled its foreign-buyer surcharge to 8 per cent, while Queensland implemented a 3 per cent surcharge.
Chinese buyers turning away from Australia
The policy changes have prompted some China-based businesses to diversify by selling other countries’ real estate.
Investorist, a business-to-business, off-the-plan property website, surveyed 120 China-based agents for its China 2017 International Property Outlook report.
A majority 83 of the agents said they were currently selling property in Australia, but only 47 said they would sell in Australia in the next 12 months.
Investorist chief executive Jon Ellis said Chinese buyers’ motivation had also changed since the report in 2016.
“Asset protection and wealth creation was the number one reason that people were investing out of China,” he said.
“This year, it’s more child education, lifestyle and potential migration has now bubbled to the top as the key motivator.