he appetite of Chinese buyers for Australian property has been greatly underestimated with demand stronger and deeper than ever before, according to Brian White, the chairman of real estate agency Ray White.
The gyrations in China’s sharemarket had made no difference to developers’ and investors’ intentions either within China, or overseas, said Mr White, who oversees the company’s 1000 office-strong network. “We had a team in China last week, including Dan (Mr White’s son and head of Ray White’s commercial business),” Mr White told The Weekend Australian. “Nowhere did he see a lack of interest. The strength of demand is astonishing. ”
Steve McCann, the chief executive of Lend Lease, Australia’s largest apartment developer that this week reported a $619 million profit, said the group had sale contracts for $4.7 billion worth of new apartment projects around the world, with about 35-40 per cent of buyers — whether for projects in Australia, Britain or the US — coming from overseas. Of the pre-sales, $3.4bn was Australian apartments, with most of the offshore buyers coming from Asia including China. “We have really good visibility and based on the prices and demand for apartments globally, there’s a very deep pool from Asia. I don’t know what the catalyst will be to slow that down … but we’re not seeing any signs of that happening yet,” Mr McCann said.
‘‘Our most recent launch was in Darling Harbour and we sold out about $600m worth of apartments in five hours. That’s a record for Australia,” he said of the May sales launch of the Darling Square project to be built on the site of the Sydney Entertainment Centre.
Mr McCann said he did not see a housing bubble in the overall residential market, but acknowledged that booms did not last forever. “I can’t imagine the price increases being maintainable, so I would imagine in the next 12 to 18 months price growth will probably stop,” he said.
Colliers International Victorian managing director, residential, Tim Storey dismissed fears of an oversupply of Melbourne apartments after recently launching a 1000-unit project — Swanston Central — that he expects to sell out in a “matter of months”.
His team sold 5000 Melbourne apartments last year, but will sell fewer this year as not as many new unit towers have been launched. If complete projects were marketed offshore and “we opened up to Chinese demand, it would be unbelievable” Mr Storey said.
Sydney’s apartment market will be tested today, with developer Crown Group launching its 326-unit Infinity project at Green Square in South Sydney.
The Australian | August 29, 2015