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Balwyn up 45.8% as Chinese Buyers move in; Is this really happeing mel?
Topic Started: 20 Dec 2013, 11:18 AM (1,383 Views)
peter fraser
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Chinese buyers in rush for Melbourne's prestige school zones

Extraordinary price growth in a range of up-and-coming suburbs in Melbourne's east has been attributed to Chinese families' focus on desirable homes near prestige schools. And some are pushing up values by knocking down existing homes to build grand new ones.

Figures from the Real Estate Institute of Victoria show 45.8 per cent growth in Balwyn; 22.2 per cent growth in Balwyn North and 23 per cent growth for Mount Waverley in the past year.

LJ Hooker Glen Waverley agent Joseph Ngo said his agency had made 35 sales totalling more than $20 million in the past six months, with 90 per cent of his clientele Chinese. Sixty per cent of those sales were to overseas Chinese investors, he said, with 30 per cent local Chinese-born buyers.

“They're buying a lot of the properties unconditional - $100,000 to $200,000 over market price is not a problem for these buyers,” he said.

Joe Tan, who is of Chinese-Malaysian descent and migrated to Australia eight years to study engineering, has just paid $1,255,000 for a three-bedroom home in Lincoln Avenue in Glen Waverley,

Now a property developer, he and his fiance Elsie fought off several other Chinese-born buyers to purchase the home because it fell in the catchment area for the prestigious Glen Waverley Secondary College.

Read more here
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mel
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Peter, I guess what the data is saying here is that David really "should have bought now".

Like I said - I hope he has a plan B.
APF - a place where serious people don't take themselves too seriously. There's nothing else like it.
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peter fraser
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mel
20 Dec 2013, 11:24 AM
Peter, I guess what the data is saying here is that David really "should have bought now".

Like I said - I hope he has a plan B.
Data on individual suburbs can be highly inaccurate, but it does point to trends and the suburbs in that area are certainly trending upwards. It looks rather two speed in Melbourne.

Edit: Ah yes David should have had a "Plan B" but he didn't. I haven't seen much of him posting lately. He has lost a lot of support since the market turned upwards - again.

Edited by peter fraser, 20 Dec 2013, 12:51 PM.
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themoops
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Unfortunately David is another denier of the effect mass immigration has like most of the MB crowd.
stinkbug omosessuale


Frank Castle is a liar and a criminal. He will often deliberately take people out of context and use straw man arguments.
Frank finally and unintentionally gives it up and admits he got where he is, primarily via dumb luck!
See here
Property will be 50-70% off by 2016.
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mel
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themoops
20 Dec 2013, 12:53 PM
Unfortunately David is another denier of the effect mass immigration has like most of the MB crowd.
He often mentions that he rents a house in the suburb from the OP. The last time I saw him post here he was talking about how the fact all his neighbors are now buying badass european cars is an indicator that the bubble is due to burst.
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peter fraser
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mel
20 Dec 2013, 01:09 PM
themoops
20 Dec 2013, 12:53 PM
Unfortunately David is another denier of the effect mass immigration has like most of the MB crowd.
He often mentions that he rents a house in the suburb from the OP. The last time I saw him post here he was talking about how the fact all his neighbors are now buying badass european cars is an indicator that the bubble is due to burst.
That's completely the wrong way of analysing the situation. It assumes that people who own their own homes in affluent suburbs and who also drive luxury cars are all completely stupid. In my experience that category of people are actually quite bright and tend to make intelligent decisions - if they are buying luxury cars it's because they can afford them.

I worry about renters from low socio-economic areas buying luxury cars, but not people from good areas.

In fact when I look at a lot of the comments from many bears who often assume that all home owners are stupid, it's no wonder that their analysis is so far out - they start with the wrong premise.

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mel
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It would be interesting to follow the rents in the area.
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yup
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Chinese abroad have very few avenues for investing their surplus cash (and being net savers, there’s plenty).

Just off the top of my head – problems that Chinese have with investing in their own country:

1) Cash deposits: under market interest rates, used to cross subsidise state investment in uneconomic infrastructure projects.

2) Equities/stock markets: not in a communist country. That’s just plain silly.

3) Housing: hot soup bubbly prices for ghost towns

4) Bonds/debt: near non-existent market (I hear Shanghai has bonds, but it’s not a realistic investment vehicle for the masses).

No wonder Chinese money is heading offshore – they’ve got no other option.

Politicians love it, because it makes the accounts looks good (i.e. GDP and foreign investment is up! we did that!).

The only reasons why I’m skeptical of Chinese capital is that:

1) lack of transparency between who is the State vs. the individual,

2) the lack of clear rationale for investing in certain asset clases (i.e. less a profit motive, and more a savings vehicle, which sees money cluster in seemingly odd places), and;

3) the sheer amount of surplus Chinese capital is mind boggling. Neither points 1 or 2 would matter too much if this money werent such a fundamental game changer on the economies it touches.

Is Chinese capital a good/bad thing? no idea… There are a plethora of industries that could thrive on an injection of Chinese capital… (established housing is not one of them.. dairy production, maybe)

Tread lightly.
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mel
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^^ Good post. It would be interesting to get miw's take..
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