A top auctioneer says Chinese buyers have returned to Australia’s property market and are causing a stir at auctions as they outbid locals.
Tom Panos, a real estate coach who auctions houses on Channel Nine show The Block, told 2GB’s Ben Fordham that he had noticed an influx of Chinese buyers at Saturday’s auction.
The Sydney-based auctioneer said recent estimates that international investors were snapping up $8 million of Australian property every day were conservative and that the amount being spent was ‘actually much higher’.
‘Asian buyers are back. I’m looking at it at Saturday’s auction,’ Mr Panos said.
‘Chinese buyers are snapping up $8 million worth of Australian property every day.’
He said the Chinese were ‘overtaking local home hunters’ and spending more money than investors from anywhere else in the world.
Mr Panos said he could ‘feel some resentment’ towards international investors who were ‘not applauded’ by local buyers after the auction closed.
‘You can tell there’s tension,’ he told the radio host.
The auctioneer said foreign buyers would have to seek approval from the Foreign Review Board, a process he described as ‘not onerous’.
‘Chinese people love Australian real estate,’ he said.
‘They love the education here, they love the lifestyle, they love that it’s probably less polluted, it’s a safer place.’
He said buyers were splashing cash in Melbourne first and Sydney second.
Not only that, after the Chinese buyers there are Hong Kong buyers. They are the second largest foreign buyers who are buying,’ he said.
Mr Panos said sometimes what appeared to be an Australian buyer at auction actually represented an investor from Hong Kong or China.
‘I often think that a buyer who buys a property is an Australian citizen but when you look at the money trail, where it comes from, you see they actually represent an overseas buyer,’ he said.
‘Who bought a lot of real estate at the moment. That’s actually helping the market stay relatively well priced even though we’ve had 12 rate hikes.’
Tom Panos, a real estate coach who auctions houses on the Channel Nine show The Block, said he had noticed an influx of Chinese buyers at Saturday’s auctions.
Mr Panos discusses the recent boom with 2GB Radio’s Ben Fordham
Many Australians say they are bracing themselves for prices to skyrocket as Chinese buyers return.
‘The Australian government should stop this soon before the price goes through the moon,’ wrote one.
Mr Panos asked his followers if they thought international buyers made it difficult for local buyers to purchase property.
‘Of course. They must love Australia and have the money,’ said one.
‘No. Foreign buyers buy what locals can’t afford,’ wrote another.
A third commented: ‘It’s a no brainer, starting in the early 2000s – overseas buyers feel safe investing in Australia.’
New Treasury figures show the Chinese will spend $2.4 billion on Australian residential real estate in 2021-22, with investment rising in the next financial year.
That equates to $6.6 million a day, with Chinese investors spending significantly more than those living elsewhere.
Chinese bought 2,317 homes in Australia in one financial year.
In Hong Kong, which is part of China, investors spent $600 million buying or investing in 689 homes, compared to Vietnam’s $400 million for 391 properties.
But the Australian figures are even more dramatic when data from July 2022 to March 2023 is covered.
In these nine months alone, Chinese investors spent $2.3 billion, which would equate to $8.4 million a day, snapping up 1,775 properties.
Those from Hong Kong spent $400 million, buying 467 properties.
Juwai IQI, which markets real estate to Chinese investors, said it received more inquiries about Australia than Canada, the UK or the US.
Kashif Ansari, chief executive and a co-founder of Juwai IQI, said Chinese demand for Australian property coincided with Chinese interest in studying at an Australian university.
The most popular destinations are all the traditional, wealthy Anglo countries with world-class education,’ he said.
A slowdown in China’s property market, following problems with apartment building giant Evergrande, has encouraged Chinese investors to consider wealthier, global countries, particularly where English is spoken.
The most popular destinations are all the traditional, wealthy Anglo countries with world-class education,’ he said.
A slowdown in China’s property market, following problems with apartment building giant Evergrande, has encouraged Chinese investors to consider wealthier, global countries, particularly where English is spoken.
“Foreign, Chinese investors are attracted to real estate investment as an easy-to-understand category that will provide price appreciation and reliable long-term foreign exchange earnings that are uncorrelated with Chinese economic cycles,” Mr. Ansari said.
Australian interest rates are also at an 11-year high of 4.1 percent to combat high inflation.
China grapples with the opposite problem, potential inflation, as consumers there cut spending despite recent rate cuts.
This means Chinese investors have more savings and see more potential for property values to rise in Australia than in their home country.
‘In this era of high interest rates, Chinese investors with access to ready capital have an advantage over local buyers,’ Mr Ansari said.
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