China’s super wealthy have led a jump in the number of fast-tracked residential visas for those investing more than $5 million in Australia, with September alone set to be among one of the best performing months in the four years since the scheme was started.
The recent uptick in the number Significant Investor Visas granted to foreigners has eased fears that Chinese high-end buyers had been forced out of Sydney’s luxury property market.
The figures coincide with reports from prestige agents in key areas that the drop off in the number of foreign buyers has been replaced by more “local” buyers who are recently arrived immigrants with a greater understanding of the processes required to buy Australian real estate.
20 highlands avenue gordon Photo: Supplied
The SIV scheme gives Australian residency to foreign applicants willing to spend at least $5 million on complying investments. After four years visa holders are eligible for permanent residency. China accounts for 89.9 per cent of SIVs granted.
Overseas buyers are typically allowed to buy only new properties, but those who hold this visa are permitted to buy existing stock.
“The introduction of almost 1600 new, wealthy families into Australia represents a very significant increase in the number of high net worth individuals in the country,” said Charles Pittar, chief executive of the Chinese property website Juwai.com.
“These are usually very dynamic and self-made business people and their families, so this is great news for Australia’s economy and philanthropic sector, Mr Pittar said.
It is also good news for Sydney’s prestige home owners hoping to sell before Christmas. Michael Pallier, of Sotheby’s International, said he has seen a spike in the number of buyers from China in recent weeks in particular.
“I have two SIV-holders who were competing at an auction on Monday night for a house on Bellevue Hill’s Fairfax Road for between $5.5 millon and $5.9 million,” said Mr Pallier. “Both buyers need to buy nearby and soon because they have kids who are starting at Scots College next year.”
Martin Ross, of Christie’s International, said that buyers from China in particular are becoming more educated about what’s required to buy property in Australia, as well as gaining a better understanding of the price.
“Twelve months ago buyers came out and bought first and would assume everything would fall into place so they could settle on the deal, but now they’re doing their due diligence first,” Mr Ross said. “And that turnaround has happened this year.”
The Gordon suburb record was reset last week at $6.7 million when the Federation residence Belalie sold to a high net worth buyer from China, who has put the property in the name of his 18-year-old son currently here on a student visa.
That sale result through McGrath’s Phillip Waller was revealed on a sale notification, topping last year’s high of $6.05 million.
“When we needed the cheque to exchange on the property the buyer kept texting me to say he was hanging out with his mates across town and couldn’t come into the office until next week, so in the end we had to send a driver to pick it up from him and get it to the bank before it closed,” Mr Waller said.