Queensland new target for overseas investors
Overseas investors who have been driving up prices in Sydney and Melbourne have turned to a third Australian state capital city according to one property lawyer.
Chinese capital is pouring into the Brisbane and Gold Coast property markets at a rate “never seen ever before”, according to Andrew Johnson, head of Mills Oakley Lawyers Brisbane property team.
“We've seen a massive up swell of inbound investment in south-east Queensland from mainly Chinese investors and development companies in the last six months in particular,” Mr Johnson said.
“The Melbourne market was the first to be hit, then the Sydney market and Brisbane is always a bit slower and lags behind [but] we're certainly in the middle of the wave now.
“I can't see this slowing down up here for the next 18 months,” Mr Johnson said.
Chinese purchasing intent increased 17 per cent in the second quarter of 2015 compared with the same period last year, according to Juwai.com.
Mr Johnson said Chinese investors are going head-to-head over development projects and engaging in bidding wars with Australian industry heavyweights such as Metro Property Development, Meriton and Mirvac.
The competitive market is forcing Chinese buyers to pay “top dollar” compared to what the Australian market would pay.
The movement of capital from Asia to Australia has been encouraged by recent free trade agreements, according to Mr Johnson.
“The Australian government is obviously indicating to the overseas market that we are open for business,” he said.
While the boom in inbound investment in real estate is good for business, Mr Johnson acknowledged that Chinese buyers could be driving the price of property up and locking younger generations out of the market.
Read more:
Notorious spruiker in ASIC's sights again
Sydney price growth third highest in the world
Why you should have 3 pre-auction prices
Housing construction has already peaked
Why you should target oversupplied markets