China is a big economic superpower without any doubt. It has the world’s largest foreign reserve too. As per a report in CNBC report few months earlier, China has 1.09 million millionaires. It is also creating 40,000 if not more every year. With this affluence comes the need to continue investing. After all, only the rich think about investing and creating more wealth. Besides the love for gold, Chinese loves properties and this can be seen from all their investments in overseas markets as well as being the single largest foreign investors in many countries. The latest one, Australia.
According to Australia’s Foreign Investment Review Board (FRIB), the number has more than doubled from AUD5.9 billion to AUD12.4 billion. For the first time, China has also overtaken the US as the largest investor in Australia. The gap is huge, with AUD27.7 billion for China versus only AUD17.5 billion for the US. The largest few of Australian’s property investors are all ‘neighbours’. They include the Malaysians, the Singaporeans, the Hong Kongers and the Chinese. Yes, many Malaysians love to migrate and take up PR in Australia. Some bought in advance for their children’s education in future.
With this, perhaps Australian’s property market would continue to prosper unless the investments from China stops. At the current rate, just relying on the Malaysians or the Singaporeans buying Australian properties may no longer be sufficient. With demand, supply would follow and the rate of new supply may try its best to keep up and take advantage of this new increase in investments. As long as all these investments are into properties which continue to be utilised, it should be okay. If the new properties are all empty, that’s a sign that bubble may be building up. Will continue to read and share.
written on 2 May 2015
Next suggested article: Property Bubble? What Bubble. There’s no bubble.
