Chinese buyers looking to ‘safe’ Australia
“Like an athlete who struggles to win a competition but in the end comes out on top, Australia could look even better after the pandemic than it did before to buyers from all over Asia.”
That’s the call from Georg Chmiel, executive chairman of Chinese real estate firm Juwai.com, who this week spoke to Australian Property Investor Magazine.
Together with New Zealand, Mr Chmiel said Australia’s reputation as a clean, safe and low-density destination might be even more appealing to Chinese property buyers in the post-COVID-19 world.
Juwai, which means ‘home overseas’, is visited by tens of thousands of Chinese buyers each day from more than 300 cities throughout China, as well as major Chinese communities in Taiwan, Hong Kong, Malaysia and Singapore.
With a monthly audience of 2.4 million consumers from around the world, Juwai’s research arm found that 83 per cent of all international property enquiries about Sydney were from China.
Mr Chmiel said Melbourne was the top city overall for Chinese buyers, followed by Sydney and Brisbane.
While inquiries from China were down 14 per cent on the Juwai.com portal, demand from local buyers has fallen even further.
Safe as houses
As Australian listings surge to their highest levels in three years and domestic buyers cling to their jobs and keep their savings in the bank, buyers in China are increasingly turning to the smallest continent as a safe and affordable place to send their children to study.
Chinese property investment is intrinsically linked to student arrivals.
“Australia was already appealing as a safe country where your investments are protected,” Mr Chmiel told Australian Property Investor Magazine.
“The country seems to have managed the pandemic well and that makes it even more attractive to foreign buyers.
“Marketers in China are already using Australia’s good performance to persuade parents of children who have been studying in the US and the UK to look at Australia instead.”
The numbers of Chinese students have declined sharply this year because of the difficulty in travelling to Australia and finding the student employment needed to support themselves.
But the health situation is far worse in the United States and United Kingdom, the biggest competitors for international students.
Early in the year, when COVID-19 was ravaging China, there was a sharp reduction in Chinese buying of apartments in Melbourne, Sydney and Brisbane.
Asked if there were signs of this trend reversing, Mr Chmiel acknowledged that travel restrictions and social isolation measures had made sales difficult in a practical sense.
“The biggest challenge in the first quarter has been getting interested buyers, whether foreign or local, to close the deal, but now the Australian market is beginning to open up slowly.
“That’s a positive development that will make marketing and closing sales progressively easier.”
Degrees of diplomacy
The Morrison Government recently urged global support for an independent inquiry into the source of, and response to, the coronavirus pandemic. It prompted a ferocious backlash from China. The country’s ambassador to Australia, Cheng Jingye, warned that Chinese tourists “may have second thoughts” about visiting Australia, while parents might reconsider educating their children in a country they may judge as “not so friendly, even hostile”.
Whether this amounts to an actual boycott of Australian tourism and education is yet to be seen and probably unlikely.
Asked whether the recent diplomatic bickering was likely to deter Chinese buyers of Australian property, Mr Chmiel said, “We don’t see any sign of that.”