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According to a new Juwai.com report, the Foreign Buyers Restrictions Report for 2018–19, the world will see fewer new foreign buyer restrictions imposed in top Chinese property destinations in the year ahead than in any of the prior three years.
Juwai CEO Carrie Law noted that the Reserve Bank of Australia, the Australian Treasury and a parliamentary inquiry have all found that foreign buyers do not cause house price inflation in Australia.
Yet the federal government and six of the eight states and territories have “found it hard to resist” targeting this group with no voice in the political process, Ms Law added.
“Taxing foreign buyers gives state governments the appearance of taking action without having to tackle stamp duty and the planning mechanisms that are a major cause of the affordability crisis.”
The report found that the top Australian destinations for Chinese buyers are Melbourne, Sydney, Brisbane, Adelaide and the Gold Coast, followed by Canberra and Perth.
After retreating from an exuberant peak in 2016 of $101.1 billion, Chinese international real estate investment again appears to be on a growth path, although steadier and restrained than what was seen in that golden year, Ms Law said.
“The Chinese government seems comfortable with what it calls ‘rational’ growth in international investment.
“Beijing has already telegraphed that it may experiment with further loosening capital controls. China has already resumed two key outbound schemes for investment in overseas securities, which had been suspended to reduce capital outflows.
“These have no direct impact on foreign property buyers but do reveal a change of direction — from tightening to loosening.”
The Financial Times has reported that it expects some of the controls introduced over the past two years to be “quietly relaxed”.
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