A significant amount of offshore investment into Australia’s residential development sites in 2017 was from Chinese investors and developers, who purchased $2.02 billion worth of sites throughout the year. This equated to one-third of total site sales for the year. While this is down from the 38 per cent recorded in 2016, the share of site sales to Chinese buyers has tripled since 2013.
Looking across the country, 38.7 per cent of residential sales in Victoria were made to Chinese buyers, representing the highest share of all the states. This popularity can be attributed to the sustained population growth, strong residential capital gains, and relatively low total vacancy rates Victoria has been experiencing. It is also considered better value relative to Sydney by many investors and developers.
Victoria nabs highest share of total site sales to Chinese investors
There has been a shift in the type of sites foreign investors and developers have been purchasing, with an increase in the purchase of low and medium density sites. In 2017, sites suited to low and medium density projects accounted for 29 per cent and 17.1 per cent of development site sales to Chinese buyers, respectively – up from 2 per cent in 2013.
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