Home prices in Sydney could rise by as much as 10 percent over the next 12 months, driven in part by unprecedented levels of Chinese demand, according to McGrath Estate Agents.
As much as 80 percent of homes in parts of Sydney are being sold to Chinese buyers, John McGrath, chief executive officer of the company that recorded A$7 billion ($6.5 billion) of property sales in the year to June 30, said in an interview in Sydney yesterday. Record-low interest rates and the biggest influx of investors in almost a decade are also fueling prices.
“The Chinese market is extremely strong, the strongest I’ve seen a new entrant into the market,” McGrath said. “Record low interest rates, the ability to fix such rates for a long period of time is very attractive.”
Chinese buyers, facing government restrictions on purchases at home, were the third-biggest source of foreign investment in Australian real estate, behind the U.S. and Singapore in fiscal year 2012, the latest figures from the Foreign Investment Review Board showed. They accounted for A$4.2 billion of transactions, a 75 percent jump from 2010, according to the data.
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Mingze Wu
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