Dose

Fairfax: The Yellow Peril is upon us

511 posts in this topic

Failed off-the-plan apartments ‘second-hand’

 

 

...Under Australian law, foreign investors can purchase only new properties...

If an off-the-plan sale falls through, the property will be considered second-hand, The Australian reports. This means thousands of foreign buyers will be stopped from picking up the properties, lowering the eventual resale price.
Confirmation on the ruling comes amid reports of a growing number of Chinese buyers walking away from off-the-plan apartment sales, forcing them to sell.
“Under subsections 15(4) and (5) of the Foreign Acquisitions and Takeovers Act 1975, a dwelling is considered to be sold when an agreement becomes binding,” a spokeswoman for the Australian Taxation Office said.
“If the property is onsold after the date upon which the contract becomes binding, and prior to settlement, then this is considered to be an established dwelling....

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Family farm in Australia's fastest-growing suburb hits $95m jackpot

 

 

A Melbourne couple have hit a farming jackpot, walking away from their Wyndham Vale sheep farm in the city's west with $95 million after Frasers Property purchased the landholding.

 
The family, who didn't want to be named, sold their Black Forest Road farm which they purchased in the 1970s, to the Singapore-based property developer, scooping even more than the most lucrative Australian lottery offering...

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A comment posted on the above link and the article below seem to be telling the same story regarding China:

 

 

I have been following this blog for a while since moving to Brissie from China.

Disclaimer: I am not one the uber rich Chinese that people talk about.

@56,

People have misconception about China and its people. Chinese people does not have unlimited buying power. Honestly, recent flood of Chinese buyers in the market is a direct result of fleeting smart money from China, and it would not last long.

China has a long history of forex manipulation, I bet you all know. Manipulating the market has a cost, cost of real money that the government cares about, forex reserver, or more simply USD. When domestic economy is good and exports bring in incessant USD cash flow, it is not a problem. However, in recent years, accompany recent deteriorating of investment environment, smart money is on the run in fear of future CNY depreciation, I mean, Russian or Venezuelan style. This, directly sent property prices in countries that have “easy” migrational policies to the top, and guess which cities are least affordable in the world? Vancouver, Hong Kong and Sydney. Thanks for prolonged forex manipulation, early runners got the chance to take out their money in full.

However, things are changing. Factories are closing down in China, and foreign investors are moving their product lines to Vietnam and etc. Unemployment is high, and trade deficit looms. Money continues to flow out though the government is tightening all aspect of forex related activities. For example, one cannot wire more than USD 50K per year abroad, and it can be very tricky to send money to an account that is not under your own name. Withdrawls on a ATM overseas are limited to CNY 100K (< AUD 20K) per person per, and CNY 10K ( ~ AUD 2000) per day. The spread of buying/selling USD is high, and this is more obvious if you try to buy USD with CNY out of China. In short, nobody wants CNY any more. The forex reserve is bleeding to death and CNY's depreciation is accelerating, and things will soon go out of control.

I took most of my money out last year when exchange rate was USD/CNY=6.1~6.2, now it is around 6.78. Chinese forex reserver was about 15.5% of its M2, which implied a USD/CNY rate of around 8. The figure should have further worsen since then. I will not at all be surprised if one day it is 20.

I am looking forward to a major crash of Chinese economy in one year if not two. Partly because of its economy and partly because of US Fed will soon be forced to hike rate. (It is a mess in US as well, Keynesianism f*cked up the whole world). My money is kept half AUD and half USD, because Australia economy/currency value has strong correlation with China as well. I still do not own a PPOR, and hopefully I could afford one when the day comes, if not SHTF.

 

Offshore Yuan Trades Near Record Low as PBOC Seen Allowing Drop

 

 

...The offshore yuan traded near a record low as Chinese policy makers signaled they are willing to allow greater currency flexibility amid a slump in exports and an advance in the dollar....

...A net $44.7 billion worth of payments in the Chinese currency left the nation last month, according to data released by the State Administration of Foreign Exchange. That’s the most since the government started publishing the figures in 2010....

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Had a music concert on the weekend. Of the 22 students 16 were East Asian, 5 from the sub-continent... my son was the odd one out! Similar ratio for the educators.

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The corner of Australia that’s become a rich foreigners’ enclave which ordinary Australians can never afford

 

 

IT’S a small corner of Australia which is rapidly becoming a foreigners-only enclave that ordinary Australians will never be able to afford.

This exclusive precinct is already up to 80 per cent foreign owned and mostly by Chinese investors.
Back in Shanghai and Beijing, the name Barangaroo has become a byword for Australia’s most desirable location and the hot ticket for high end property ownership.
Sitting on the jewel of Sydney Harbour, the status pocket of postcode 2000 has become a huge hit with Chinese buyers.
Rich Chinese are snapping up property for its views, architecture, sumptuous finishes and prestigious location right next to where James Packer’s $2 billion casino is to go up.
And the percentage of Chinese ownership is likely to increase with the construction of the next set of luxury towers and with Packer luring high rollers — known as “whales” — to spend their millions is his gaming rooms.
Chinese buyers have snapped up apartments at the Barangaroo waterfront tower (above) which is up to 80 per cent foreign owned. Picture: RPData.
Chinese buyers have snapped up apartments at the Barangaroo waterfront tower (above) which is up to 80 per cent foreign owned. Picture: RPData.Source:Supplied
Barangaroo is a magic word for real estate in China where rich investors are buying up the harbourside apartments in this pocket of Australia. Picture: Artist’s impression Crown Casino at Barangaroo.
Barangaroo is a magic word for real estate in China where rich investors are buying up the harbourside apartments in this pocket of Australia. Picture: Artist’s impression Crown Casino at Barangaroo.Source:Supplied
Former Prime Minister of Australia Paul Keating and NSW Premier Mike Baird at Barangaroo, rapidly becoming an exclusive enclave for foreign investors. Picture: Craig Wilson
Former Prime Minister of Australia Paul Keating and NSW Premier Mike Baird at Barangaroo, rapidly becoming an exclusive enclave for foreign investors. Picture: Craig WilsonSource:News Corp Australia
Agents and auctioneers are selling apartments along the exclusive strip of Barangaroo Avenue, Barangaroo for almost double the price for which they were bought off the plan three years ago.
“For Chinese buyers, part of the appeal is the status of living in Barangaroo,” said Raine & Horne Real Estate City Living’s Matt Mifsud.
“It’s attracting buyers from China and other countries not only because of its quality but the precinct it’s in,” Mr Mifsud said.
“But there’s very little left to sell.”
Two apartments Mr Mifsud has for sale in the relatively low rise, seven storey Alexander and Anandara towers have risen in price since 2013 from $1.875m to $3.15m for a two bedroom, and from $3.995 to $6m for a three bedroom penthouse apartment.
Both apartments are directly over the water, which he said appealed to buyers rather than being high up in a tower.
Mr Mifsud’s colleague, Raine & Horne’s head of auctions James Pratt, said that Barangaroo’s exemplary international reputation had negated any controversy about Packer’s casino.
This penthouse apartment, which almost doubled to $6m, is one of the few Barangaroo properties available after Chinese investors have flocked to buy. Picture: RPData.
This penthouse apartment, which almost doubled to $6m, is one of the few Barangaroo properties available after Chinese investors have flocked to buy. Picture: RPData.Source:Supplied
Chinese investors believe Barangaroo is synonymous with luxury, newness and unbeatable views. Picture: Artist’s impression Barangaroo skyline.
Chinese investors believe Barangaroo is synonymous with luxury, newness and unbeatable views. Picture: Artist’s impression Barangaroo skyline.Source:Supplied
None of the Barangaroo apartments like this (above) have made it to auction, selling beforehand and often to a Chinese buyer. Picture: RPData.
None of the Barangaroo apartments like this (above) have made it to auction, selling beforehand and often to a Chinese buyer. Picture: RPData.Source:Supplied
The Packer casino at Barangaroo has been subject to a legal challenge, and 18 of his staff have been arrested in China for allegedly targeting “whales”.
“All the auctions I have been involved in were cancelled because the property sold before the auction date and interest was too strong,” Mr Pratt said.
“My feedback from Chinese buyers is if the property is in Barangaroo, they don’t even need to visit Australia to see it, they will just buy it because of the quality.
“No expense has been spared and it’s newness with a lot of style.
“The infrastructure is going up around it, then there’s the retail space, the shopping complex, the walk around the Harbour foreshore, the free flowing layout, the luxury of space and the fact it is in the heart if the CBD with this much class.”
‘Chinese buyers don’t even need to visit Australia if the property is in Barangaroo (above), they will just buy it because of the quality’. Picture: RPData.
‘Chinese buyers don’t even need to visit Australia if the property is in Barangaroo (above), they will just buy it because of the quality’. Picture: RPData.Source:Supplied
One of the few Barangaroo apartments left (above) it is directly over the water, which appealed to buyers rather than being high up in a tower
One of the few Barangaroo apartments left (above) it is directly over the water, which appealed to buyers rather than being high up in a towerSource:Supplied
Foreign investors were attracted to the Barangaroo apartments’ free flowing layout, the luxury of space and the ‘fact it is in the heart if the CBD with this much class’. Picture: RPData.
Foreign investors were attracted to the Barangaroo apartments’ free flowing layout, the luxury of space and the ‘fact it is in the heart if the CBD with this much class’. Picture: RPData.Source:Supplied
Mr Mifsud said the development of two further residential and commercial towers plus the casino was “really creating a buzz” in the precinct.
“Barangaroo is becoming a cultural hub and everything is happening ... a David Jones, a Fitness First, the parklands, Wynyard Walk.
“They will put in a train station, they are building four ferry wharves, there’s the proximity to the casino and it’s walking distance to the city.”
Barangaroo still has spaces for ordinary folk, the headlands with its engineered sandstone foreshore, the shopping precinct and public parks.
Barangaroo will retain public space, such as the headlands with its engineered sandstone foreshore (above). Picture: News Corp.
Barangaroo will retain public space, such as the headlands with its engineered sandstone foreshore (above). Picture: News Corp.Source:News Corp Australia
The $2b six-star hotel and casino is not due to open at Barangaroo until 2021, with all the fanfare of Packer’s $4.5m Macau casino launch last October.
The Australian mogul paid actors Leonardo DiCaprio and Robert De Niro and director Martin Scorsese $17m each to launch the Studio City resort on Macau’s Cotai strip.
But there are fears that with the advent of high roller junketeers arriving on chartered VIP jets to spend seven figure credit lines at Barangaroo’s gaming tables, some parts of the public amenity surrounding the towers may shrink.
“High rollers don’t want to be photographed or have their movements monitored by the media,” a gaming and crime expert, who asked not to be named, told news.com.au.
“Barangaroo could become an exclusive precinct largely closed off for ordinary people.”

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Snag with sale of Cate Blanchett’s Sydney trophy home highlights China’s money flow fears

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Australian actress Cate Blanchett wanted to sell her home on Sydney’s waterfront. The buyer who wanted it was from China. The trouble started right there.

Getting the money out of China proved impossible. The $20 million price tag was far in excess of the $US50,000 ($66,800) limit on what Chinese are allowed to convert each year due to capital controls. The would-be buyer couldn’t settle, and the deal fell apart — one of dozens of failed sales affecting Chinese nationals in Australia, according to several real estate agents handling such transactions....

Some are certainly able to take their money out and buy the harbour front mansions.

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China’s super wealthy invest $240 million into SIV scheme in one month, easing prestige property fears

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China’s super wealthy have led a jump in the number of fast-tracked residential visas for those investing more than $5 million in Australia, with September alone set to be among one of the best performing months in the four years since the scheme was started.

The recent uptick in the number Significant Investor Visas granted to foreigners has eased fears that Chinese high-end buyers had been forced out of Sydney’s luxury property market....

 

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State government's may need to look for alternatives to keep earning stamp duty revenues from the sale of Meriton Valleys! :)

 

China’s Army of Global Homebuyers Is Suddenly Short on Cash

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... He may abandon a 2.4 million yuan ($348,903) home purchase in western Melbourne, even after shelling out a 300,000 yuan deposit last August....

... Australia approved A$24 billion ($18.1 billion) of real estate investments from China in the fiscal year ended June 2015, the most recent figures available, making the country by far the biggest source of foreign buyers...

...Even with tightened capital controls, brokers say motivated Chinese investors can usually find ways around them. In any case, many already have money parked offshore, according to Michael Finger, the head of Ray White Double Bay, a real estate agency in Sydney’s eastern suburbs. Just before Christmas, he sold a multi-million dollar home to Chinese citizens who had moved money to Australia before the clampdown. Finger says he’s seeing more e-mail inquiries from buyers eager to buy offshore assets before authorities clamp down any further....

 

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1 hour ago, cobran20 said:

State government's may need to look for alternatives to keep earning stamp duty revenues from the sale of Meriton Valleys! :)

 

China’s Army of Global Homebuyers Is Suddenly Short on Cash

 

 
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Even with tightened capital controls, brokers say motivated Chinese investors can usually find ways around them. In any case, many already have money parked offshore, 

 

The Chinese will always find a way to get around rules if motivated. But Australian banks clamp down on lending, increased SD to foreigners, etc will curb their demand for oz property.

 

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9 minutes ago, cobran20 said:

Still not much more than petty cash

Foreigners sell $107m in illegal property

 

Beat the Chinaman with a lettuce leaf for 10 years till there is a slight reddening of the skin. I live in China town. I KNOW there are foreigners buying established properties here. 

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54 minutes ago, zaph said:

Beat the Chinaman with a lettuce leaf for 10 years till there is a slight reddening of the skin. I live in China town. I KNOW there are foreigners buying established properties here. 

Keep monitoring. See if it reflects the presume drop in numbers PI tourists:

Australia's property boom showing signs of slowing as buyers hold back

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...

One big concern is the drop off in the number of Chinese buyers, following a crackdown by Beijing on capital outflows and Australia's tightened restrictions on lending to foreigners. Individuals taking the maximum $50,000 a year out of China now have to commit to not spending it on real estate and risk being investigated by the Chinese authorities if they break that pledge.

Chinese tour numbers halve

Hong Kong-based hedge fund manager Apt Capital Management has shorted Australian banks because of their exposure to a property market it believes is out of step with Australia's economic strength. It is forecasting a severe correction.

Apt Capital strategist Amy Reynolds said interest rate rises or a drying up of foreign investment were the most likely triggers for a future downturn in prices.

Esther Yong, director at Chinese language property portal AC Advertising, said the curbs on lending to foreigners and Beijing's restrictions had quelled interest, leaving only the most committed buyers...

 

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Looks like the hot money is now going into tier 2 cities:

Domino effect of Chinese billionaires investing in Gold Coast property during $60 billion wave

$60m in 10 months: Asian buyers snap up Gold Coast mega-mansions

Chinese to build $1bn city on coast

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Vast sugar cane lands on the northern tip of the Gold Coast have fallen into Chinese hands in a $1 billion-plus deal that could see the rural landscape transformed into a new city by a Chinese theme park entrepreneur.

Chinese company Songcheng Performance Development is striking the deal to give it control over a giant swath of land in the Norwell Valley between Brisbane and the Gold Coast.

The group is laying the foundations for an entire city with housing, office, health and educational precincts to be developed over 25 years, with a spending spree on infrastructure planned to tie up with existing road networks.

While the deal is subject to Songcheng’s due diligence, it would see a new masterplanned city developed with ambitions for it to become a service hub for local and international tourists.

Details of the nascent deal are tightly held but the owners of the 6117 hectares of farmland have been briefed on the deal and have formally agreed to the sale.

For Songcheng, backed by Chinese billionaire Huang Qiaoling, a deal would dramatically boost its ambitions in Australia.

Mr Huang is one of China’s most successful theme park entrepreneurs and is also one of the 10 biggest in the world.

The Shenzhen-listed company last November unveiled plans for a $400m cultural theme park on a $55m riverfront Nerang site on the Gold Coast.

Representatives of the company, including Songcheng chairman Huang Qiaoling and CEO Huang Hongming, met Prime Minister Malcolm Turnbull when that deal was unveiled.

It appears keen to pursue the latest deal, making a partial payment on the “substantial deposit” required to secure the deal.

The farmers involved have been tight-lipped but when complete the transaction could amount to Australia’s largest land sale. Roland Evans, the Canford Property Group principal who has been marketing the land, said the purchase could be settled by mid-2018.

“The buyer’s one of four offshore groups that put their hands up — three from China and one from the Middle East,” he said. “The first offer came in at $550m and offers have progressed upward from there.”

Such a transaction would be almost unprecedented with only last month’s deal between Springfield Land Corp and Chinese companies R&F Properties and Etone on an apartment development project with an end value of $6.3bn comparable in scale. Mr Evans declined to identify the buyer, saying only it was a listed company worth billions of dollars that would spend between $25m and $35m carrying out due diligence.

“If the sale goes ahead, it will be a financial saviour for the cane farmers — many of them are in a state of despair over the challenges they face in the sugar industry,” he said. “They’ll be debt free and able to farm their land for the foreseeable future — until it’s required by the buyer.”

The Chinese company is pitching its city as not only providing construction and tourism jobs but also higher skilled education and health industries.

Mr Evans said the group was preparing submissions to the Gold Coast City Council and Queensland government.

If history is any indication, this could be another Yeppoon

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I think the youth of today is entitled to ask why governments allow for them to be priced out of the market?!

Chinese buyers to prop up Australian housing market: Credit Suisse

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...According to a new paper by Credit Suisse analysts Hasan Tevfik and Peter Liu, who filed the FOI, the data "implies foreigners are acquiring 25 per cent of newly completed supply in NSW and 16 per cent in Melbourne, or 21 per cent if we combine the two states". The total value of new houses in both states was $39 billion over the relevant 12 months...

 

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22 hours ago, cobran20 said:

I think the youth of today is entitled to ask why governments allow for them to be priced out of the market?!

Chinese buyers to prop up Australian housing market: Credit Suisse

 

I have to agree Cobran.

It seems that greed wrapped up as "good business", or "free market" capitalism is the catchcry of all western governments. I'm not necessarily a socialist who believes that it all has to be equal, but I do believe in at least a "fair go".

I hope the whole sorry mess blows up in the respective government's faces, because as Armstrong often comments; "People only change when it comes down to "crash and burn". Our current group of politicians are only allowing it, because none of them want to be remembered as the politician who rained on the party. They are essentially all "populist" politicians, because that's what got them into politics in the first place. They like to be popular!

It is well researched and known that alcoholics, gamblers, drug addicts and every other addict for that matter, only ever change when they reach rock bottom. Until then they completely deny there is any problem. There is all the hallmarks of an addiction in our current home "market". (HOW I HATE THIS TERM :angry::wallbash:)

This is also a sad indictment on the whole human race, that we would rather see people exposed to the elements, then lose our precious equity. I have watched with disbelief and fascination the rise and rise of home prices, thinking that it couldn't possibly go any higher. I have been naive and over time have questioned every aspect of my thinking throughout this whole ordeal. I am reluctant to suggest any longer that it couldn't go any higher, because I have been wrong so many times. I now realise they can stoke the fire as long as they like, simply through immigration and foreign ownership.

I now worry more about infrastructure keeping pace.

Unfortunately the compassionate side of me is well aware that any "crash and burn" situation, will mean that a whole lot of relatively innocent Australians are going to suffer the consequences well before any politician.

I can't help but feel totally impotent in the face of the problem. How, When, Where and Why is this ever going to change?

 

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11 minutes ago, Solomon said:

Unfortunately the compassionate side of me is well aware that any "crash and burn" situation, will mean that a whole lot of relatively innocent Australians are going to suffer the consequences well before any politician.

The politicians will know what policy is likely to be passed and sell their IPs in advance.

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It's the third wave of colonisation in Australia (after British and American). Not sure people get that yet. It's more than just Chinese buying up Australian property.

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