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Third of Aussie properties boug...

Third of Aussie properties bought by foreign investors in first six months of 2017

One-third of activity in the Australian property market came from overseas investors in the first six months of 2017, new research shows.

In particular, Asian property investors snapped up a significant proportion of the assets up for offer down under, spending some $2.01 billion between January and June this year, according to the statistics from CBRE.

There had been concerns that investments from the Asian market would plummet after the Chinese State Council recently imposed new restrictions on overseas investment. However, these were not as dramatic as anticipated.

The total sum invested in Australian property by Asian investors did fall by 25 per cent compared to the final six months of 2016, but market experts are confident that a drop in spending from China will open up the property investment landscape to businesspeople from elsewhere in the region instead.

As a result, new business relationships and partnerships could potentially be formed between Australia and overseas nations that have not previously worked together so closely.

The CBRE research also found that more Asian investors are putting their money into costlier projects, with almost three-quarters (74 per cent) of the deals closed in the first six months of this year coming with a price tag of at least $250 million. During the same period last year, just over half (56 per cent) of investments carried the same price tag.

Steve McNabb, head of research for Australia at CBRE, commented: "Assets remain eagerly sought after and this is evident in yield compression across all asset classes nationally in the first half of 2017."

The organisation's director of research for the Asia-Pacific region Robert Fong added: "New regulations should help to ensure that future outbound investment is more financially sound and strategically focused, but the impact of Chinese capital on key global real estate markets should continue for some time."

All information provided is of a general nature only and does not take into account your personal financial circumstances or objectives. Before making a decision on the basis of this material, you need to consider, with or without the assistance of a financial adviser, whether the material is appropriate in light of your individual needs and circumstances. This information does not constitute a recommendation to invest in or take out any of the products or services provided by SMATS Services (Australia) Pty Ltd or Australasian Taxation Services Pty Ltd.

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