Australian Property Foreign Investors & CoreLogic articles of interest

Australian property, expensive for us, not so for foreigners

RPDATA

Posted: 07 Jul 2015 03:42 PM PDT

With plenty of talk about a housing bubble and home values climbing much higher in Sydney and Melbourne, housing is looking expensive to many Australians.  Low interest rates and the strong gains in certain areas are making residential housing investment quite attractive for some which is one of the drivers resulting in increasing home values.  While housing may be looking expensive to locals, the declining Australian dollar means that it may be looking more attractive to foreign buyers.

Since combined capital city home values reached their most recent low point in May 2012 they have risen by 26.8%.  At the same time the Australian dollar has fallen by -13.3% over that period in trade-weighted index terms.  While the depreciation in the dollar has no impact on local buyers, for off-shore buyers the fall in the Australian dollar is likely to make Australian housing even more attractive.  Furthermore, the Reserve Bank continues to state that there is a need for an even lower dollar which would exacerbate the relative affordability even further.

Foreign buyers are meant to be purchasing brand new homes in most instances.  There have been numerous recent reports of foreign buyers not adhering to these rules.  Furthermore a recent parliamentary inquiry found that the Foreign Investment Review Board was significantly underfunded and as a result has not been able to effectively monitor and enforce foreign investment rules.

Combined capital city home values have increased by 26.8% between May 2012 and June 2015.  Keep in mind that these figures are heavily influenced by the Sydney and Melbourne housing markets with these the only two capital cities recording value growth in excess of this figure over the period.  When you look at that 26.8% increase across other currencies you can see the impact of the falling exchange rate.  Of those currencies highlighted only the Japanese Yen and Indonesian Rupiah have seen values rise by a greater amount.  Across most other currencies the relative value rises have been significantly lower than they have been in Australian dollar terms.

Once you look at capital cities that have seen relatively lower recent capital growth, there has been a significant improvement in Australian housing affordability for foreign buyers.  Not to mention the fact that in many of these foreign countries mortgage holders are borrowing at significantly lower interest rates than those available to Australians.

With the RBA stating that the Australian dollar remains overvalued, any further falls in the Aussie dollar are likely to result in even more attractive buying conditions for foreign buyers. Given this it is imperative that foreign investment rules are tightened and FIRB improve their surveillance work.  A central register of foreign buyers would also be seemingly important.  The Victorian Government has recently announced that it will increase fees and charges to foreign buyers of property in that state.  Despite howls of protest it would seem that this is likely to have little material impact on foreign demand for housing.  Furthermore, a national approach similar to this would be a good step towards appropriately funding FIRB to undertake their review and surveillance of foreign housing investment.  Particularly given that should the dollar fall further demand from off-shore buyers is likely to increase.

Earlier this week Federal Treasury released the Exposure Drafts and Regulatory Impact Statement of legislation designed to tighten foreign investment rules, including those relating to residential real estate.  The document can be read hereand submissions can be made up until Friday 17 July.

2015 ONWARDS

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Our goal is simple: to provide the greatest possible net operating income, while continually enhancing the value of the asset. We believe in using proven and new strategies and continually looking for new ways to provide cost savings for the property and the owner Our vision To provide a flexible and all-encompassing management service for our customers' properties and assets. Our values Exceptional customer service.  Transparency, punctuality and reliability.

Our goal is simple: to provide the greatest possible net operating income, while continually enhancing the value of the asset. We believe in using proven and new strategies and continually looking for new ways to provide cost savings for the property and the owner
Our vision
To provide a flexible and all-encompassing management service for our customers’ properties and assets.
Our values
Exceptional customer service.
Transparency, punctuality and reliability.

About ljgrealestate 据联大

Removing the Hassle from Sales and Rentals across South East Queensland. Aim to Empower other like minded Property Investors. L J Gilland Real Estate is a prestigious boutique agency specializing in Property Investment Management Services and the Sales of Investment Properties with tenants in place. Comprised of a top performing group of handpicked specialists, our Agents proudly serve Property Investors in Queensland. Since 1996 our Agency has demonstrated a genuine enjoyment of working with people, developing long-term relationships and delivering on the promise of great service. Carlos and Linda Debello offer property investor's the confidence to sell and lease in any market. We provide comprehensive market appraisals, exclusive multimedia marketing campaigns, and knowledgeable, highly personalized counsel on all aspects of real estate. Our Property Management Team is equally considerate, offering investors with in-depth advise, well-researched rental valuations, and highly professional rental management services. http://goanimate.com/movie/0M4bvcZzgIbI?utm_source=linkshare&uid=0u6RGtWsmlVc Carlos’ direct mobiles are 0400 833 800 & 0413560808. Linda’s mobiles are 0409995578 & 0414978700 (prefer email contact for Linda). Office 07 3263 6085. http://www.ljgrealestate.com.au http://www.yellowpages.com.au/qld/aspley/lj-gilland-real-estate-pty-ltd-14091356-listing.html http://au.linkedin.com/in/lindajanedebello http://twitter.com/GillandDebello http://www.facebook.com/pages/ljgrealestate
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