From the Herald Sun today:
There is no doubt that Chinese property buyers are flocking to suburbs such as Balwyn, Balwyn North, Glen Waverley, Doncaster, Box Hill and Ashburton.
…One Balwyn real estate agent told me that 35 out of the past 40 sales over $1 million in his area were to foreign buyers, primarily from mainland China or Hong Kong. It’s no surprise that the number of foreigners buying established residential properties nationally has gone from 647 to 5091 in the past three years. In the last financial year alone, foreigners spent $17 billion on more than 11,000 residential dwellings.
So why are so many people trying to deny this is happening? And why are those who bring up the race issue being accused of xenophobia or racism?…At the moment many residents are feeling crowded out, overtaken and somewhat resentful.
…Such a process is not even legal under the current foreign investment rules. As the CEO of the Real Estate Institute of Victoria, Enzo Raimondo, confirmed on the weekend, it is against the rules for temporary residents or foreigners to buy existing houses that are habitable, knock them down and build new homes. However, that is what is happening in many suburbs, not just in Victoria but around Australia.
…There are also reports of foreigners being able to “land bank” — buy up multiple properties for development. There also doesn’t seem to be anyone monitoring whether they sell the property when they leave the country, which they are legally required to do.
I spoke to several real estate agents across the city this week and all confirmed they do not see it as their role to perform checks on foreign purchasers. That is fair enough. Surely it’s up to the Foreign Investment Review Board to ensure compliance with its own rules.
The new inquiry into foreign investment impacts on the housing market has a big task ahead of it. This issue is going to build and build so long as house price rise and in the longer term become explosive as China liberalises its capital account.
Soon enough, the issue will undermine the community’s faith in high population growth as well.
Ignore action on the issue at your peril, government.
