Australia’s biggest city has been enjoying a significant influx of overseas property buyers in recent years. The Global Development Review 2013 from international real estate group, Knight Frank, has shown that Sydney is the location of choice for wealthy property investors from Hong Kong.
The report showed that Sydney lies ahead of cities including London and Tokyo for Hong Kong buyers and is also the third most popular location for residential property investors from Indonesia.
Liam Bailey, the global head of residential research for Knight Frank says that while the flow of wealth into the Sydney property market is expected to increase, buyers’ expectations are also on the rise.
“Developers are increasingly bringing more high-specification ‘trophy’ buildings to the market. The importance of partnering with a renowned architect, a good location and the appeal of serviced apartments should not be overlooked,” Bailey said. He added, “Chinese buyers’ global presence is fuelled in part by a strong yuan and slowing domestic economy, both of which are encouraging Chinese investors to look further afield in an attempt to diversify their investments”.
Various factors are likely to have influenced the increase in Sydney’s popularity as a location for property investment by Chinese buyers. The ramifications of the global financial crisis are still being felt around the world. During this time of uncertainty, buyers are increasingly being drawn to cities that are perceived to be sheltered from wider economic issues.
Education and lifestyle also play highly important roles in cross-border property investment, where world-class schools and universities, a high quality of life and a safe environment are of primary importance. Australia certainly can be said to fit into this description in the global market.
Sydney’s property market is also currently experiencing low interest rates, which can help to explain why the city is considered one of the most desirable investment destinations in the Asia-Pacific region.
Finally, the interest in international investors may also have been boosted by a new visa category, which was introduced last November, called the Significant Investment Visa. This allows temporary residency to foreign nationals who invest a minimum of AUD$5million during a four year period as well as entitling them to the option of purchasing existing dwellings rather than being restricted to new-builds and off-plan properties.