Recently, according to the Australian Bureau of statistics, Australian house prices are experiencing a 10-year slump, with an overall decline of 5.1% in the past 2018. According to market analysis, the surplus of real estate resources and the tightening of immigration policy are the main reasons for the collapse of Australian house prices. Let's take you to know.
Australian house prices plummeted 5.1%
According to data released recently by the Australian Bureau of statistics, Australian house prices fell 5.1% last year, more than during the financial crisis a decade ago (4.6% that year).
Specifically, in five of Australia's eight provincial capitals, house prices fell last year. Among them, Sydney, the largest real estate market in the country, suffered the biggest annual drop of 7.8%, followed by Melbourne, Darwin, Perth and Brisbane, with a drop of 6.4%, 3.5% and 2.5%, respectively.
In contrast, house prices in Hobart, Australia's largest port city, rose 9.6% last year, while those in Canberra and Adelaide rose 1.8% and 1.5% respectively.
Two factors bring up the cold winter of real estate market
The slump follows a 75% jump in prices in Sydney in the five years to mid-2017. If we lengthen the time line a little longer, Australian house prices have been rising for the past 50 years, and Australian real estate has become one of the best return assets in the world.
So why is Australia's property market cool. Market participants summed up as two points: first, Australia's property surplus; second, China's capital inflow decreased.
In the fourth quarter of last year, Australia's total housing stock increased by 42600 residential properties, while average house prices fell by a $15700 to a $651100 over the same period, according to the Australian Bureau of statistics.
"One of the key issues in the property market on the east coast of Australia is the slow response to demand pressure," Philip Rodwell, governor of the Central Bank of Australia, said in a recent interview. Although house prices in Sydney had been rising before, when a large number of new apartments went online, demand had fallen, leading to lower prices. '
At the same time, the tightening of the immigration policy has reduced the inflow of funds from China, which is also the main reason for the sharp drop in Australian house prices. According to a report released last month by real estate consulting firm DTL, China's overseas real estate investment in 2018 hit a new low of US $15.7 billion in nearly four years, a sharp drop of 63% year on year. Among them, the investment in Australia dropped to US $1.3 billion.
A local real estate manager in Sydney said that the biggest reason for the decline in Australian house prices since 2018 was the departure of Chinese buyers. According to the data in 2017, three-quarters of the foreigners who buy houses in Australia are Chinese.
Is Australian property worth buying
Ms. Yang of Xi'an has been engaged in overseas investment and real estate for a long time. She said that 2016 is a watershed. Before that, Chinese people were really enthusiastic about buying real estate in Australia. "Before 2016, when buying a house in Australia, you can get a mortgage loan, and the loan can enjoy the same interest rate policy as the local people. It's relatively generous. However, since April 2016, the policy of loan to buy a house has been tightening, and later it has become full purchase. Before April 2016, there was another policy, that is, after overseas customers mortgage, they can only repay the interest without repaying the principal within 10-15 years through application. But after that, the policy stopped, which made the burden on investors heavier. '
According to Ms. Yang's customer data, although house prices have plummeted, there are still quite a number of Xi'an people who invest in Australia. Only now, some changes have taken place in the form. Customers are more concerned about self-supporting property. In the past, the investment purpose was more obvious and the proportion of investment could reach 20%. Now, the proportion is much lower because they have to pay the full amount. '
As for the way that some overseas real estate companies publicized to immigrate to Australia through real estate, Ms. Yang gave a negative attitude. 'you can't buy a house in exchange for an Australian green card. Not only in Australia, but in all developed countries, buying a house means buying a house, and emigration means emigration. There is no way to link it up. Normal investment can't handle emigration. Some companies publicize that buying property can handle immigration, which is just a gimmick. Only when you buy a specific property can you handle immigration, and the property you buy is 30% higher than the normal price. The extra money is the cost of immigration, and it's not real immigration. It's just to help customers obtain a long-term residence status. '
Ms. Yang said that different countries have different policies, but most countries implement the policy of buying property in exchange for long-term residence rights, "because immigration means the change of nationality, and it must pass the language barrier. For Australia, it's impossible to immigrate by buying a house, and there's no possibility of even playing the edge ball. '
"Local banks in Australia are very happy to lend to Chinese people, because Chinese people's credit rating is much higher than that of local people. Later, the threshold for buying a house was raised, which also caused a large number of employees who earned commissions to lose their jobs. From the data point of view, after 2016, the number of Chinese home buyers in Australia has decreased, but this is related to the fact that the previous main investment product is apartments, because the down payment for apartment products only needs 10%. '
Generally speaking, if it's just ordinary real estate investment, then it's no problem to buy Australian real estate at this time. However, under Australia's new immigration policy, the previous situation of house buying immigrants no longer exists. If people living abroad for a long time are considered, it is not appropriate to invest in Australian real estate.