The amount foreign buyers are spending and what impact this activity is having on prices have been hot topics in the local real estate market over the past year.
While the RBA has said foreign purchases aren’t impacting housing prices the ANZ has an excellent chart in its Monthly Australian Economic Chartbook which shows that even though the total value of foreign buying is still a small portion of all Australian property purchases, it has grown significantly.
The ANZ said:
Foreign investment approvals for Australian residential housing in recent years reflect both increasing demand for established housing from temporary residents and strong demand for new housing from non-residents. The net impact of this source of demand on home prices differs across regional housing markets and is difficult to accurately gauge but is commonly overestimated. The level of foreign-sourced demand for existing property ($AU6.4bn in 2012-13), in particular, remains small compared with around $AU200bn of total Australian housing sales in 2012-13, or $AU140bn of owner-occupier housing finance for established housing purchase.
The value of approved foreign purchases of established Australian housing represents less than 3% of annual turnover of established houses.
Not huge, but growing nonetheless.
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