Strong Investment from China in Melbourne's Real Estate Market

Chinese investors are making significant investments in Melbourne's real estate market, and market experts believe that this capital influx is contributing to rising property prices in certain areas of the city. Latest data from the Australian Federal Treasury shows that Victoria has become the leading destination in Australia for international property investors, with significant interest from Chinese investors. According to data from PropTrack, searches from China are focused on Melbourne's central area, as well as suburbs such as Balwyn, Balwyn North, Camberwell, and Glen Waverley.

China Leads in Real Estate Investment Proposals

According to reports from the Treasury Department, China has led the way in approved residential real estate investment proposals in Australia during the first half of the 2023-2024 financial year, contributing AUD 1.5 billion from July to December last year. Although this figure is down from AUD 3.4 billion in the 2022-2023 financial year, Chinese investors still contributed AUD 800 million to Australian real estate in the final quarter of 2023. Additionally, investors from Hong Kong, India, Vietnam, and Taiwan added another AUD 400 million to the total investment value.

Victoria Leads in International Real Estate Transactions

A report from the Foreign Investment Review Board (FIRB) shows that 2,240 properties in Victoria were purchased by foreign investors, double the number of transactions in Queensland, which ranked second with 1,121 transactions. While only Australian citizens and permanent residents are allowed to purchase existing properties, international investors must obtain approval from the FIRB to buy new properties.

Foreign Investment Drives Up Property Prices in Melbourne

Overall, foreign investors poured AUD 4.9 billion into 5,360 homes across Australia during the 2022-2023 financial year, a 27% increase compared to the previous year. Daniel Ho, co-founder and CEO of Juwai IQI, noted that international investor interest is rebounding post-pandemic, with Victoria attracting the highest number of transactions from millionaire investors.

David Morrell, a representative of high-end property buyers in Melbourne, mentioned that areas such as Toorak, Canterbury, Camberwell, and Box Hill have seen property prices rise due to foreign investment. He believes this trend is driven by investors seeking safe places to park their money, with premium markets like Toorak offering a secure investment environment.

International Demand Boosts Prices in Eastern Suburbs

Andrew Dimashki, director at Harcourts Judd White, pointed out that demand from international investors has driven average house prices up by 200% in Melbourne's eastern suburbs over the past decade. For instance, a six-bedroom house in Glen Waverley was recently sold for AUD 3.9 million, higher than the expected AUD 3.4 million due to competition from foreign bidders. Dimashki emphasized that the influx of capital from high-end international investors is creating intense competition in the market.

In conclusion, foreign investment, particularly from Chinese investors, is having a significant impact on Melbourne's real estate market, driving up prices in attractive areas. Victoria leads the country in the number of international property transactions, reflecting the city's strong appeal. While foreign investment helps increase the housing supply, it also contributes to rising property prices and creates greater competition in the market.