Sydneysiders say “no” to foreign property buyers

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By Leith van Onselen

A new survey has been released showing that the overwhelming majority of Sydneysiders oppose foreign investment into residential property. From Domain:

A new study into attitudes towards foreign investors, spearheaded by University of Sydney housing researcher Dallas Rogers, surveyed 900 Greater Sydney residents in November 2015 and was released on Wednesday after being published in the Journal of the Australian Geographer.

When asked if foreign investors should be able to buy properties in Sydney, 28.3 per cent of respondents said they “strongly disagree” while 27.6 per cent said they “disagree”. A further 21.8 per cent were on the fence…

And 64 per cent believed foreign investment was the main reason property prices had risen, followed by the drivers of low interest rates, planning issues and local investors…

There was also a strong correlation between anti-multiculturalism and those who were anti-foreign investment.

“There’s not a lot of support for foreign investment at the ground level…”

Shane Oliver, from AMP Capital, said the response was similar to when Australians are asked whether they want immigration: “Often they say no … but policymakers continue to allow it.”

Banning foreign buyers would have a “negative impact” on the market and could see apartment prices fall by up to 30 per cent, he warned.

“Prices would come down quite substantially, which would be bad for 65 per cent of Sydneysiders who own outright or with a mortgage,” Dr Oliver said.

Seriously, who could blame Sydneysiders from having such negative views towards both foreign buyers and immigration?

Sydney housing has become dreadfully expensive, the city’s roads and public transport systems are clogged, and schools and hospitals are overcrowded. Over-development is rife, with once pleasant suburbs being turned into high-rise without the infrastructure to match.

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On any given weekend, go to any group of auctions in Sydney or Melbourne and you are very likely to see them heavily represented by Chinese-origin buyers, be they non-residents or immigrants. While they may not win every auction, they do provide significant competitive pressure, pushing-up home prices. It’s little surprise, therefore, that Sydney and Melbourne are the two cities where house prices are most expensive and have risen most strongly over the past five years, given they are the magnets for both immigrants and foreign investment.

And then there’s the inconvenient issue of money laundering into Australian real estate, which the Australian Government refuses to police. Transparency International recently ranked Australia as having the weakest anti-money laundering laws in the Anglosphere, failing all 10 priority areas. This follows the Paris-based Financial Action Taskforce’s 2015 evaluation that Australian homes are a haven for laundered funds, particularly from China, as well as similar warnings from Austrac.

Put simply, the government’s globalist agenda of open foreign investment and mass immigration is badly eroding incumbent residents’ living standards, with the benefits being captured by the very few at the top. Sydneysiders are right to be angry.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.