Chinese Gold Rush for Australian Bricks and Mortar
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IN THE 1850s, the Chinese came to Australia to mine for gold. This year they’re coming for property.
At a recent roadshow in Shanghai, the prestige agency Sotheby’s showcased nine Sydney luxury homes to an enthralled audience.
In the room were 60 people who had expressed interest in the new Significant Investor Visa, which fast-tracks migrant visas for foreigners who invest more than $5 million in approved investments, such as government bonds, managed funds or companies.
If all 60 applications were to proceed, that’s $300 million going straight into the Australian economy. ”They’re queuing up to come here,” the Sotheby’s agent, Michael Pallier, said.
”I believe the prediction this year is that 700 people will take up the visa, so that’s … $3.5 billion that should come into the economy.”
Not to mention the stamp duty from the multi-million-dollar properties they’re lining up to buy. Let alone the agents’ commissions.
The head of global residential for Knight Frank, Lord Andrew Hay, also believes Australia is set to benefit from a significant wave of property investment from overseas – and not just the Chinese. ”There is a word out there in the world of global wealth and that is ‘safe haven’,” the London-based agent said.
He believes continuing eurozone angst will see wealthy investors there also look to Australia. ”I think 2013 will be the year that they arrive on these shores in much bigger numbers … Switzerland’s a great place to put your money, but you run out of things to do pretty quickly.”
Richardson and Wrench Bondi Junction agent Sandy Kogan said she received a lot of interest from overseas investors in a block of four flats in Coogee that sold at auction on Thursday night. There were 50 contracts out on it. After a frantic bidding war between nine bidders, a buyer’s agent acting for an offshore buyer emerged victorious, paying $2.71 million. The reserve was $2 million.
”He was an Australian of Singaporean descent,” Ms Kogan said. ”But it shows the level of confidence in Australia and the vendors are over the moon.”
A Department of Immigration spokesman confirmed this week that there has been plenty of interest in the new visa since its introduction on November 24. By last Tuesday, 287 expressions of interest had been processed, with 131 invitations to apply issued. However, no actual visas had been granted yet.
But Chinese homehunters were traipsing through Sydney trophy homes as early as December, already excited about the prospect of getting one.
Many of the sales to the off-shore buyers slip under the radar because of confidentiality agreements, but it is believed there was a sale of more than $14 million in Vaucluse to a mainland Chinese buyer on Thursday. This followed last Saturday’s auction frenzy as six Chinese buyers fought over a Vaucluse mansion that sold for $5.15 million. ”I haven’t seen an auction like that for many years,” said Daniel Ungar of Ray White Double Bay who shared the listing with Sotheby’s.
The Christies agent, Ken Jacobs, says Hong Kong Chinese have other reasons to invest here apart from the new visa. ”The Chinese government has doubled the sales tax on Hong Kong property,” he says. It’s apparently worried about a property bubble.
Lionel Busquets, of Ray White Seaforth, sold a Seaforth waterfront with a pontoon and jetty for $6.5 million on February 9 to offshore Chinese. ”The children are already enrolled at Kings,” Mr Busquets said. ”The brother said ‘I’ll take the house next door too, also for $6.5 million … but the deal fell over because it didn’t have the right feng shui.”
Top sales to Chinese buyers
- Bay Street, Mosman, sold for $20 million
- Vaucluse Road, Vaucluse, sold for $14 million
- Bay Street, Mosman, sold for $12.8 million
- Seaforth Crescent, Seaforth, sold for $6.5 million
- Vaucluse Road, Vaucluse, sold for $5.8 million
Source : Domain Sydney Morning Herald