PropTrack search data shows that interest in Australian property from overseas has never been higher.
Property portal, Juwai IQI, also ranked Australia as the most popular destination in the world for Chinese buyers:
“Chinese consumers have had their borders locked down for three years, and they have a lot of pending business to take care of”, Juwai IQI co-founder and group managing director Daniel Ho said.
“Whether their plans were to retire, study or just invest in Australia, they haven’t been able to do it for nearly three years”.
The Chinese government’s directive requiring foreign-enrolled students to return to universities for face-to-face learning is expected to increase buyer demand even more.
Juwai IQI spokesman, David Platter, told The AFR last weekend that the firm has “been working with a lot of Chinese ever since the borders opened. Presumably as flights continue to increase we will see buying increase”.
“These people are upper-middle-class and wealthy from a Chinese standpoint. They are buying townhouses, houses and large apartments at $1.5 million, $2 million, $2.5 million and up”, he said.
Juwai projects that third-quarter inquiries from China about Australia will be 76% higher than in the second quarter, and 35% higher than in the first quarter.
“The first wave of buyers this year consisted of students who urgently needed to move to Australia to complete their studies in person”, the firm said to the SCMP.
“Students have also been joined by Chinese families who lived in China during the three years”.
Earlier this week, Bloomberg published a report explaining how Chinese were skirting the nation’s capital controls to send funds out of the country into foreign real estate, most notably Australia:
There’s no reliable estimate on how big the industry is, but probes disclosed by authorities suggest an enormous scale.
The money was spread among a network of five organizations that used more than 8,000 bank accounts across more than 20 provinces.
The networks are truly global in scope, operating not only in Hong Kong but wherever there are significant numbers of the Chinese diaspora.
To ultimately settle exchanges via hawala, Chinese underground banks regularly use cash generated by criminal groups through activities such as drug trafficking, cigarette smuggling, organized illegal immigration and human trafficking, according to the NCA.
Right now there are increasing signs that more money is looking to leave. Real estate consultant Juwai IQI said in August that it expects more than 700,000 Chinese to exit the country in the next two years.
Top destinations for buying property—based on searches on its site—include Australia, Canada and the UK.
Australia has one of the weakest anti-money laundering regimes in the world with regards to real estate gate keepers like realtors, lawyers and accountants:
This has made Australian property a magnet for laundered money from China.
Clancy Moore, CEO of Transparency International Australia, told Michael West Media that “Australia is one of only three countries in the world without Tranche 2 requirements for our anti-money laundering / counter terrorism financing laws”.
“Unfortunately, when we look at these organised crime schemes more than half the money moves through real estate in Australia”, said Nathan Lynch, financial crimes expert and author of the book “The Lucky Laundry”.
Any established home sold to a foreigner is a direct kick in the face of younger Australians, since we have a chronic scarcity of homes.
In some cases, it is also illegal because it is carried out through money laundering and organised crime.
The Albanese Government should (but won’t) reverse the Rudd Government’s stupid decision in 2009 to allow temporary migrants to purchase established homes.
Labor should also implement the global “Tranche 2” anti-money laundering rules for real estate gatekeepers, which was promised by Australia 17 years ago.
Established Australian homes must not be left as a store of wealth for foreign buyers, organised crime and money launderers.
