Foreigners Lead Purchases of Australia Development Sites

Foreign buyers continue to drive sales of Greater Sydney’s residential development sites, according to a recent report. In the year through August, sales of development sites in the Sydney area totaled $4.61 billion, with foreign buyers accounting for 63% by value, real-estate consultancy Knight Frank reported. The figure compares with a total of $4.31 billion in the prior year. Purchasers from mainland China were 79.2% of all international buyers of development sites. Other foreign buyers came from Hong Kong and Japan. Knight Frank said that a focus on dense development and a weaker Australian dollar have helped fuel interest from overseas developers. For Chinese nationals, slower economic growth at home and turbulence in the local stock market could push more investors to look for places abroad to park their money. Total sales in all four major Australian markets—Greater Sydney, Greater Melbourne, Greater Brisbane and Greater Perth—reached $7.3 billion in the year ending in August, a year-over-year decline of 5.7% from $7.74 billion. Foreigners represented 47.6% of all purchases by value in Greater Melbourne, 58.6% in Greater Brisbane and 64.6% in Greater Perth. Since 2011, these four areas have added 123,815 new apartments while 80,135 are currently under construction. High-end apartments for sale in Greater Sydney can go for up to $45,000 a square meter, or around $485 a square foot, according to data from Knight Frank. At A$6 trillion as of July, the value of the Australian housing market is more than three times larger than the annual output of the country’s economy, according to CoreLogic. Over the 12 months to July 2015, the most expensive 25% of capital cities recorded the fastest rate of value growth, an 11.8% increase, said the data provider in its latest market overview released last week. Read the full report here. Write to Andrea López Cruzado at andrea.lopez@dowjones.com Follow Mansion Global on Facebook, Twitter and Instagram Write to us at info@mansionglobal.com