- Chines investors spent $24 billion on Australian real estate in the last year
- The figure, compiled by Chinese website Juwai.com, is up $6 billion from 2015
- It comes as real estate experts claim there are 200,000 empty homes in Sydney
- Douglas Driscoll, CEO of Starr Partners, said foreign investors were buying
Chinese investors spent $24 billion dollars on Australian real estate in the last year.
The figure, put together by Chinese property listing site Juwai.com using data from the Foreign Investment Review Board, is up almost a third from the previous financial year, when it was $18.4 billion.
Sue Jong, Chief of Operations for Juwai.com, said Chinese investment in foreign real estate worldwide was forecast to exceed $100 billion by the end of the year.
Australia is the second-most-preferred foreign market for Chinese property investors, behind only the United States, and ahead of Hong Kong, Canada and Britain.
Their spending on Australian property was now almost $500 million per week.
However 2016 is expected to be the peak, as the Chinese government puts measures in place to reduce the amount of money flowing out of the country while foreign governments also look for ways to prevent Chinese spending from spiking house prices.
‘In Australia, we see that investment flows have decreased markedly from their peak, while remaining strong by historic standards,’ Ms Jong told Business Insider.
‘Capital controls, bank lending standards and foreign buyer taxes have combined to wind back the clock to 2015,’ she said.
It follows claims from real estate experts that there are 200,000 homes sitting empty in Sydney because foreign investors have bought them with no intention of living in them or renting them out.
Douglas Driscoll, the chief executive of Starr Partners, estimates the number of unoccupied homes has almost doubled from 120,000 in 2011, in a city which is already the second most unaffordable in the world after Hong Kong.
Mr Driscoll believes the empty homes are a major contributor to Sydney’s housing crisis, which has seen prices double in the past eight years and rise at an average of $222 a day.
‘Foreign investors are only exacerbating the problem by buying properties and leaving them vacant,’ he told Daily Mail Australia.
He said Chinese buyers were used to not receiving much of a return on investment and believed tenants lowered property values by putting ‘wear and tear’ on them.
‘They bring that same mentality over here without doing the research,’ he said.
‘A lot of them are also buying their children’s future, even if they are only in their teens, they are buying them now in highly desirable inner-city areas.
‘When their children are old enough they send them off to university and that’s where they live. So they might sit empty for three or four years.’
He said Australia was also an attractive location because homes were much bigger than those in Asia.
‘On average, an Australian home has 89 square metres of floor space, while a country like China has about 33 square metres of space,’ he said.