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SYDNEY: Tighter government regulations introduced by some Asian countries to cool sizzling house prices are helping to drive demand for new flats in Australia, CB Richard Ellis (CBRE) said.
The Australian apartment market is bucking a softening of the overall housing market, notably in Sydney.
Capital growth for Sydney apartments rose 3% in the year to May, while houses eked out only a 0.1% gain, according to research firm PR Data-Rismark.
"The tightening measures across Asia are increasing the amount of interest in Australian properties," Darien Bradshaw, executive director for Richard Ellis international project marketing in Asia.
Last year, Singapore introduced a new rule under which owners of government subsidised flats must stay in the property for five years before they can buy a second property.
The mainland government has also introduced a series of new regulations including a home ownership tax to deter real estate speculation.
"There are limited options for the Chinese with money to invest other than keeping it in cash," Bradshaw said. "So one option obviously in the current climate is to look overseas."
He also said young couples who planned to raise more than one child were keen to own houses overseas, adding the targeted price range for Australian assets for Asian investors was anywhere between A$400,000 and A$1 million (RM1.29 million to RM3.22 million).
"They've always got on the back of their mind... where the second child may reside and live and be educated," he said.
CBRE sales teams in Hong Kong, Singapore, Kuala Lumpur and Shanghai, conducted a synchronised launch over several weekends to market a residential project in Chatswood, Sydney. All 292 flats offered in the first phase sold out in the first weekend in March.
Some Australian developers are positioning themselves for the Asian market. Private property developer Meriton Group, headed by billionaire Harry Triguboff, said it would develop more than 1,500 flats in the next 12 months, compared with 1,000 in the past year as demand from Chinese investors keeps growing.
James Sialepis, Meriton's national sales and marketing manager, said 15% of its weekly sales were made to overseas Chinese, although the percentage was much higher if local Chinese buyers were included.
"Locations within 15km of the central business district, with good transport and educational facilities, are in most demand," he said. — Reuters
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