A Chinese omen for Aussie housing

Premium content

To access premium content, please log in or set up a subscription. It's quick and easy.

More from Business Spectator

Comments

Please login or register to post comments

Comments Policy »
Sorry Robert, what is happening in China and Hong Kong is not a omen for the Australian housing just an omen for Sydney and Melbourne apartments and the likes of Harry Triguboff (A Chinese omen for Aussie housing, November 11).
Not really a concern for the rest of us as the Chinese should not be buying here in the first place.
I think it is a long bow you draw to suggest that the vaporisation of Chinese hot money is an omen for Australia. My inclination is to say 'so what?' As long as the fundamentals of the Chinese economy remain intact the disappearance of the hot money set will be of no consequence for Australia (A Chinese omen for Aussie housing, November 11).
Robert, quite the opposite might happen as the Chinese government tries to cool off their property market and the unit prices are falling, that might trigger a flight to a relative safety and stability of the Australian housing market. (A Chinese omen for Aussie housing, November 11)
@Steven (November 11, 9.12am) - you miss the point about the interconnectedness of the markets. If the Chinese investors don't buy anymore, the developers hit the skids (loss of jobs, no new stock so rents rise etc). If the Chinese investors have to liquidate, property values collapse (not necessarily a bad thing from a few points of view) and repercussions for other investors all over the country not just in Sydney and Melbourne (A Chinese omen for Aussie housing, November 11).
As for your xenophobic comment about them not buying here - well that goes into another debate about Australia's lack of capital and the use of foreign capital to fuel our growth. (Especially the mining boom which are starting to see isn't giving us all the benefits we were told we would get.)
A better question that readers should be interested to know is how is it we have come to a situation where a sizeable portion our housing apartment market has become so commoditised and so dependent on hot overseas Chinese investment? (A Chinese omen for Aussie housing, November 11)
While our housing market is freely open for short-term gains by the developers with tacit government approval for tax duties, at the eventual expense of the local community, sooner or later, we all suffer.
And why are overseas investors allowed to buy here in the first place? Housing should be for local people to live in.
Robert, although you are not forecasting a major slowdown for China, it is good to remember that a minor slowdown will hit Australia hard (A Chinese omen for Aussie housing, November 11).
Australia's obsession with iron ore has already told us that we have become too reliant on specific areas of development. In other words - we did not spread our investments wide enough.
Our currency will fall, just like our iron ore price has fallen, no one agreed with me yet I continued to say that the cash flow into resources was ludicrous. Our resources sector inflated our currency, now it will deflate our currency.
A low value currency will make Australian property (both city and rural) low cost. Therfore it will be heavily bought by overseas investors.
The EU will go into recession (and I'm an optimist), China will slow further as a result, resource prices will continue to fall, the Australian dollar will fall, interest rates will fall.
Unfortunatley property may be the only way to make money (I hope I'm wrong) and Australia could spiral into a debt crisis because of it.
Geoffrey (November 11, 10:32):
I understand fully the impact that this issue might have on the whole housing market and that is my problem how.
Investors losing out whether they be Australian or not are of absolutely no concern to those wanting buy a home just to live in. A collapse would bring prices down to appropriate levels. I don't think this is xenophobic (A Chinese omen for Aussie housing, November 11).
Wealthy Chinese investors are spending $3 billion on Australian apartments and we have to give Australian residents a first home owners grant to compete. When will our politicians start acting in the national interest and ban foreign investment in Australian real estate? (A Chinese omen for Aussie housing, November 11.)
So let me check if I've got it right. Local property investors with negative gearing under their belt are competing for scarce properties with Chinese investors full of hot money (A Chinese omen for Aussie housing, November 11). Even if I personally don't benefit from this exciting frenzy I still participate as the a 'sponsor' of the funds for the NG as a taxpayer? Sweet.
Robert, the Chinese investments in Australia will certain fall (A Chinese omen for Aussie housing, November 11).
When you see the number of abandoned under construction buildings in all cities and towns in China it is clear that the Chinese housing bubble and also to a slightly lesser extent the commercial bubble is deflating; and with continued tightening of credit in China, the flow-on will not only efect Australia but also the US and Europe.
The optimism in housing profits is still within most peoples hopes as the way to make big money.
It is forgetten that often high returns also mean extensive losses.
Why does the issue of xenophobia get raised every time there's a genuine debate about foreign investment in the offing? (A Chinese omen for Aussie housing, November 11.)
Geoffrey Scott (November 11, 10.32am), perhaps Steven Majewski (November 11, 0.12) has every right to question the massive levels of foreign hot money that enter this country.
He could suggest a number of reasons, first and foremost being the gross disadvantages faced by locals who are comparatively heavily taxed and regulated. Then there's the issue of the social and ethical origins of this capital. Should we be as accommodating as a country if the origins of the funds turned out to be black economies, plagued by slave labour and corruption?
Mainland Chinese have been pouring about $2 billion annually into the Sydney apartment market and in the vicinity of $1 billion into Melbourne.
In years gone by countries had to send tanks and armies to take over a country. I'd say our Government is just letting China purchase our country little by little (A Chinese omen for Aussie housing, November 11).
Alas our housing market having become dependent on Chinese investment means if the Chinese falter the whole Australian economy falters (A Chinese omen for Aussie housing, November 11).
Much of the local bank profits and assets are linked to the housing market. A collapse in the housing market could see a collapse in the banks. If our businesses can't borrow capital it would destroy our businesses. It is a vicious cycle.
That the general population may never be able to afford a house and much of our real estate will be owned by overseas interests has become one of the important factors in maintaining our present economy.
No wonder the average young Australian cannot even afford to buy an apartment. They are competing with foreign investors who should not be allowed to buy residential property in Australia. Australian housing should be for Australian citizens to live in (A Chinese omen for Aussie housing, November 11).
I have to agree with a lot of comments above i.e. Australians are really disadvantaged in that foreign investors are bumping up house prices (A Chinese omen for Aussie housing, November 11). I feel that perhaps there isn't enough 'noise' coming from the media and the general population about too much foreign investments in real estate here. For example, in Singapore, foreigners are restricted in what real estate they can buy. Better still, in some European countries, there is no incentive to 'invest' in houses thus ensuring that houses are available as homes for everybody. The house prices are low and prices don't increase much so people don't use houses as 'shares' i.e. buying and selling for a profit.
I can only wonder why this Australian government does not heed the warning bells in the selling of our prime real estate to overseas buyers? (A Chinese omen for Aussie housing, November 28.) The same applies to the volume of agricultural properties going to the overseas buyers (mostly the Chinese money boys).