Are Chinese buyers obsessed with Australian property?

China has 16.5 million high net worth individuals and 568 billionaires. Their combined net worth is equivalent to Australia’s GDP.

Chinese investors are seeking properties in capital cities with solid infrastructure, strong capital yields and rental returns. As with most property buyers, lifestyle plays an important factor. Water views, cityscapes, and other superb location and quality finishes will command a premium when selling to Chinese investors – especially the high net worth individuals paying top dollar for luxury properties.

Red Door’s research with Channel Agents has revealed the average investment range for popular cities in Australia is AUD $500,000 to $950,000 for the burgeoning middle class. One of the most common purchase reasons being that they are looking to secure their children an apartment to live in whilst studying in Australia.

Investing legitimate and hidden income into real estate

Many Chinese investors have access to both legitimate and hidden income and wealth and seek to invest both of these in overseas real estate. Most investors have significant overseas portfolios already, meaning they can easily relocate their money. This is at a time when China is in the grip of its own housing affordability crisis and investors are looking outward to solve the problem.

In 2015, Chinese investors plowed $28.69 billion into the Australian economy. Approximately AUD $6.8billion of this went into Australian commercial and residential real estate. Current Foreign Investment Review Board (FIRB) policies require incoming real estate investment funding to be channeled into new dwellings, creating additional jobs in construction and supporting economic growth in Australia.

Though temporary Australian residents may be required to sell older residential property when they leave Australia, many foreign nationals are able to retain, rent out, sell or live in newly constructed dwellings. This is a major drawcard for Chinese investors looking at new residential buildings.

Other pull factors include Australia’s well-regulated land title system, buoyant real estate market, high capital gains in major cities, financial stability and lower deposit requirements.

Australia’s rental yields of 2-3% in major cities are twice that of China’s. Legislative changes to residential property investment in China also makes Australia very appealing.

Selling Australian property to Chinese investors

At Red Door, we have created a streamlined avenue for Chinese real estate buyers to negotiate the buying and selling of Australian property. Using WeChat, one of the most popular social media and lifestyle apps in the world, investors are able to connect with a wider network. Offering investment opportunities via WeChat allows sellers to reach a targeted consumer base.

Are you an investor looking for Chinese buyers, or you’re seeking for investment in Australian real estate? Learn more about Red Door today.