Governments are working to slow the movement of Chinese money into Australian assets.

Australia has lowered incentives for foreign buyers, and the state of New South Wales doubled taxes on foreign buyers to 8 percent of the purchase price. For its part, China’s government has recently implemented restrictions on the outflow of cash from the mainland.

“China’s capital controls have worked,” Jane Lu, head of Australia for Juwai said. “Look at China’s huge foreign reserves, at the strong yuan, and at the reduced the flow of money out of the country.”

In 2017, Juwai is seeing an average Chinese property buying inquiry price of about $350,000 in Australia, according to Lu. That’s about $40,000 lower than last year, she said.

Yet, according to Credit Suisse, demand is still high and not expected to slow. One of the reasons is China’s growing rate of wealth.

In 2011, the combined wealth of all of China’s millionaires was nearly equal to the value of Australia’s total housing stock. Today, however, China’s wealthy are worth twice as much as the housing stock.

Credit Suisse forecasts combined wealth of the China’s elite will continue to grow at a faster pace.

Source: cnbc china
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