According to Doug Ferguson, head of KPMG Australia's Asia and international markets, "Overall we are seeing a strong story of Chinese investment into Australia's broader economy which is in line with premium products, services and lifestyle-oriented themes." According to a recent report by KPMG together with the University of Sydney, all Chinese investors surveyed said they wanted to allocate more money to Australia, meaning the percentage of foreign owned property is likely to increase.
From May 2012, house prices have increased by 36.6 percent nationwide. Prices in Sydney have gone up the most over this period with 57.5 percent growth, followed by gains of 39.4 percent in Melbourne and 18.5 percent in Brisbane. Along with changing global conditions, increased domestic demand, and lack of housing supply, foreign investment is having an impact. The NSW government recently announced moves to hit foreign investors in the hip pocket by making changes to stamp duty and land tax on residential real estate deals.
With Victoria having already increased the surcharge for foreign buyers from 3 percent to 7 percent in its April budget and Queensland’s Labor government announcing its own 3 percent transfer duty surcharge, the NSW government are also making changes. NSW treasurer Gladys Berejiklian announced he will add a 4 percent stamp duty surcharge on residential property bought by foreign purchasers, plus 0.75 percent land tax surcharge for foreign owners from the 2017 land tax year.
Despite concerns raised about the link between high prices and foreign investment, Trade Minister Steve Ciobo seems unconcerned. In a recent interview with Sky News, Mr Ciobo said that Chinese born-Australians were often mistaken for foreign Chinese nationals. "There are so many examples where I have been told stories where people say: 'You know what, I saw Chinese buying real estate here in Australia'... But you know what? They're Chinese-Australian... But make no
mistake, the notion that in a country the size of Australia, with a population of 23 million people, that in some way high house prices are a consequence of investors from China, frankly it's laughable."