Welcome Guest [Log In] [Register]


Reply
  • Pages:
  • 1
  • 3
  • 4
Beware! The Asians Are Coming! Tidal wave of Asian money rushing into Oz cities!; Asian banks lend at low interest rates and do not have Australian bank lending restrictions
Topic Started: 19 Jun 2014, 11:54 PM (4,740 Views)
Suckpoppet
Member Avatar

Uh Oh! :bl:

http://www.businessspectator.com.au/article/2014/6/16/property/tidal-wave-asian-money-rushing-australias-inner-cities

Quote:
 
The tidal wave of Asian money rushing into Australia’s inner cities

The inner city residential property development markets of Melbourne and Sydney are experiencing a sudden and spectacular boost. For many Asian and Chinese investors, inner-city property investment in Australia is replacing gold as a hedge against possible difficult times at home.

While this has been happening for years, few were prepared for the latest set of events. It started slowly in the early weeks of January and February this year: Chinese and other Asian investors began buying apartment development sites that had secured permission to build, and are funding those developments using Chinese rather than Australian banks. In turn, most of the apartments will be sold to Chinese and other Asian investors.

In the following months, the size of the Chinese investment rose substantially and the price of inner-city land in Melbourne with permits to build has quickly doubled. A similar trend is taking place in Sydney.

The 2014 escalation has been so rapid that many Australian developers are now saying that there is no point in undertaking developments because you can make your money gaining permits and selling the land to Chinese and other Asian investors.

Accordingly, this will change the nature of new property development in our two largest cities, and will spread to other centres across the country.

Under the old practices, Australian banks made life tough for developers. To get bank funding for an apartment development, developers had to pre-sell a substantial portion of the proposed apartments "off the plan". In addition, to qualify for an Australian bank loan only about 15 per cent of a project could be pre-sold to Asian investors because the banks argued the pre-sales to these investors were unenforceable contracts.

The combination of the difficulties in gaining permission to build and the bank financing rules restricted the supply of apartments. We are now seeing a rapid increase in apartment development because Australian banks have been by-passed.

The Chinese and other Asian banks lend at low interest rates and do not have Australian bank lending restrictions on "off the plan" sales to Asian investors.

Many believe there is increased nervousness in China about lower future rates of growth and a possible social backlash. Some even suggest China's aggressive stance on disputed territories is really a smokescreen for economic difficulties at home. The jailing of Bo Xilai, who was once considered a likely candidate for promotion to the elite Politburo Standing Committee, made a lot of Chinese nervous because like Bo, they have made large sums out of corruption.

Similarly in London we have recently seen vast amounts of Russian money plunged into property in the city as a result of the turmoil in Ukraine. In previous generations that sort of money used gold as a safe haven. Now it's inner-city property. The official statistics in Australia show very modest increases in overseas investment in Australian property and that won't change because these giant offshore-funded and pre-sold developments usually miss the statistician's radar.

http://www.news.com.au/finance/real-estate/melbourne-homeowners-team-up-to-take-advantage-of-law-changes-and-net-576m-windfall/story-fndbawks-1226958657102

Quote:
 
Melbourne homeowners team up to take advantage of law changes and net $5.76m windfall

THREE savvy homeowners joined forces to sell their properties collectively, making upwards of $1 million profit.

They took advantage of recently changed zoning laws and the growing Asian investor interest in Melbourne.

The Bentleigh trio sold their houses in an off-market deal through Savills Australia.

Neighbours at 14, 16, and 18 Bent St sold their adjoining homes to a Chinese developer for $5.76 million, up to $1.8 million more than could have been expected from separate individual sales.

The undisclosed purchaser intends to apply for permission to develop a multi-level apartment building on the combined 1985sq m site.
Edited by Suckpoppet, 19 Jun 2014, 11:55 PM.
Profile "REPLY WITH QUOTE" Go to top
 
GloomBoomDoom
Member Avatar


It's certainly not going in to their SSE composite index.
MSE
Profile "REPLY WITH QUOTE" Go to top
 
Foxy
Member Avatar
Zero is coming...

This is good news for the baby boomers wanting a little extra cash for the house.
They can buy a bigger caravan.

Peter
http://www.afr.com/content/dam/images/g/n/2/1/u/8/image.imgtype.afrArticleInline.620x0.png/1456285515560.png
Profile "REPLY WITH QUOTE" Go to top
 
Lef-tee
Default APF Avatar


Mustapha Mond
20 Jun 2014, 01:05 AM
This is good news for the baby boomers wanting a little extra cash for the house.
They can buy a bigger caravan.

Peter
That's actually a good point. The housing boom has surely benefitted remote towns by giving the baby boomers - who often become grey nomads - more money to spend trapesing around the countryside. The nomads have been a significant source of income for a lot of these little outback places. That's of no comfort to younger people in the more populated places being forced to pay through the nose or being forced out altogether but I guess it shows there are two sides to every coin.

It's still not right but I couldn't avoid making that observation.
Profile "REPLY WITH QUOTE" Go to top
 
Ex BP Golly
Member Avatar


The Chinese are like financial 4 year olds.

They love chasing bubbles and popping them..

Its fantastic that they now treat our housing market like yum cha!

Edited by Ex BP Golly, 20 Jun 2014, 09:19 AM.
WHAT WOULD EDDIE DO? MAAAATE!
Share a cot with Milton?
Profile "REPLY WITH QUOTE" Go to top
 
MMM
Unregistered

I remember around 20-25 years ago, seeing " stop the asain invasion", painted on many walls in Sydney's cbd.
"REPLY WITH QUOTE" Go to top
 
Black Panther
Default APF Avatar


Transmutation in action.
Profile "REPLY WITH QUOTE" Go to top
 
SittingOnDeFence
Default APF Avatar


Isn't this a good thing in the long rung though?

If/when there is a property bubble here, isn't it preferable to spread the risk around to a few asian banks too when it pops?
Profile "REPLY WITH QUOTE" Go to top
 
Sweetdish
Default APF Avatar


This is actually one of those things that can keep prices going up for an extended period of time.
Look at Vancouver as an example - its completely screwed.

I cannot find a single good reason to allow this to happen.
Profile "REPLY WITH QUOTE" Go to top
 
Admin
Member Avatar
Administrator

Quote:
 
The missing floors in Sydney's tallest tower

June 17, 2014
Stephen Nicholls

Sydney's tallest residential tower will have a level 82, but there will really only be 66 floors.

The developer of Greenland Centre, China's state-owned Greenland Group, has carefully avoided any reference to the number four, because "four" and "death" have a similar look and pronounciation in Mandarin Chinese.

So there's no level four, 14, 24 or 34. An entire 10 floors between level 39 and 49 don't exist. And of course no level 54, 64 or 74.

Same goes with the numbers of the apartments. "No-one wants to get any mail to number four - every time you spell out the number on your door it sounds like 'death' - it's a very bad number," says David Milton, managing director of residential projects at CBRE.

Read more: http://smh.domain.com.au/real-estate-news/the-missing-floors-in-sydneys-tallest-tower-20140620-zsazc.html
Follow OzPropertyForum on Twitter | Like APF on Facebook | Circle APF on Google+
Profile "REPLY WITH QUOTE" Go to top
 
1 user reading this topic (1 Guest and 0 Anonymous)
ZetaBoards - Free Forum Hosting
Create your own social network with a free forum.
Go to Next Page
« Previous Topic · Australian Property Forum · Next Topic »
Reply
  • Pages:
  • 1
  • 3
  • 4



Australian Property Forum is an economics and finance forum dedicated to discussion of Australian and global real estate markets and macroeconomics, including house prices, housing affordability, and the likelihood of a property crash. Is there an Australian housing bubble? Will house prices crash, boom or stagnate? Is the Australian property market a pyramid scheme or Ponzi scheme? Can house prices really rise forever? These are the questions we address on Australian Property Forum, the premier real estate site for property bears, bulls, investors, and speculators. Members may also discuss matters related to finance, modern monetary theory (MMT), debt deflation, cryptocurrencies like Bitcoin Ethereum and Ripple, property investing, landlords, tenants, debt consolidation, reverse home equity loans, the housing shortage, negative gearing, capital gains tax, land tax and macro prudential regulation.

Forum Rules: The main forum may be used to discuss property, politics, economics and finance, precious metals, crypto currency, debt management, generational divides, climate change, sustainability, alternative energy, environmental topics, human rights or social justice issues, and other topics on a case by case basis. Topics unsuitable for the main forum may be discussed in the lounge. You agree you won't use this forum to post material that is illegal, private, defamatory, pornographic, excessively abusive or profane, threatening, or invasive of another forum member's privacy. Don't post NSFW content. Racist or ethnic slurs and homophobic comments aren't tolerated. Accusing forum members of serious crimes is not permitted. Accusations, attacks, abuse or threats, litigious or otherwise, directed against the forum or forum administrators aren't tolerated and will result in immediate suspension of your account for a number of days depending on the severity of the attack. No spamming or advertising in the main forum. Spamming includes repeating the same message over and over again within a short period of time. Don't post ALL CAPS thread titles. The Advertising and Promotion Subforum may be used to promote your Australian property related business or service. Active members of the forum who contribute regularly to main forum discussions may also include a link to their product or service in their signature block. Members are limited to one actively posting account each. A secondary account may be used solely for the purpose of maintaining a blog as long as that account no longer posts in threads. Any member who believes another member has violated these rules may report the offending post using the report button.

Australian Property Forum complies with ASIC Regulatory Guide 162 regarding Internet Discussion Sites. Australian Property Forum is not a provider of financial advice. Australian Property Forum does not in any way endorse the views and opinions of its members, nor does it vouch for for the accuracy or authenticity of their posts. It is not permitted for any Australian Property Forum member to post in the role of a licensed financial advisor or to post as the representative of a financial advisor. It is not permitted for Australian Property Forum members to ask for or offer specific buy, sell or hold recommendations on particular stocks, as a response to a request of this nature may be considered the provision of financial advice.

Views expressed on this forum are not representative of the forum owners. The forum owners are not liable or responsible for comments posted. Information posted does not constitute financial or legal advice. The forum owners accept no liability for information posted, nor for consequences of actions taken on the basis of that information. By visiting or using this forum, members and guests agree to be bound by the Zetaboards Terms of Use.

This site may contain copyright material (i.e. attributed snippets from online news reports), the use of which has not always been specifically authorized by the copyright owner. Such content is posted to advance understanding of environmental, political, human rights, economic, democratic, scientific, and social justice issues. This constitutes 'fair use' of such copyright material as provided for in section 107 of US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed for research and educational purposes only. If you wish to use this material for purposes that go beyond 'fair use', you must obtain permission from the copyright owner. Such material is credited to the true owner or licensee. We will remove from the forum any such material upon the request of the owners of the copyright of said material, as we claim no credit for such material.

For more information go to Limitations on Exclusive Rights: Fair Use

Privacy Policy: Australian Property Forum uses third party advertising companies to serve ads when you visit our site. These third party advertising companies may collect and use information about your visits to Australian Property Forum as well as other web sites in order to provide advertisements about goods and services of interest to you. If you would like more information about this practice and to know your choices about not having this information used by these companies, click here: Google Advertising Privacy FAQ

Australian Property Forum is hosted by Zetaboards. Please refer also to the Zetaboards Privacy Policy