The importance of foreign investment in Australian property should not be underestimated, claims the Property Council of Australia.
The latest ANZ
/Property Council Survey shows that foreign investment in the Victorian property industry has driven business sentiment higher in the December 2014 quarter.
Property Council Victorian executive director, Jennifer Cunich, said Victorian sentiment had steadily risen eight points over the past twelve months as a result of improving industry confidence.
“Foreign property investors are helping lift industry buoyancy by playing an active part in the local market.”
Cunich said 37, 33 and 30 per cent of responders in the residential, commercial and retail sectors reported between 10-50 per cent of their sales were to foreign buyers during the quarter respectively.
“The importance of foreign investment in driving residential, retail and office capital growth expectations should not be underestimated. The recent influx is boosting construction activity, job creation and government tax revenue.”
Foreign investment has been under close observation of late, as many of Australia’s property markets – particularly Melbourne and Sydney – boom. However, Cunich says the speculation around foreign investors snapping up property and pushing up prices may be hyped up.
“Equally, the dominance of foreign buyers in the Victorian market shouldn’t be unnecessarily exaggerated. 33, 40 and 46 per cent of residential, commercial and retail responders reported zero sales to foreign buyers during the quarter respectively.”
Cunich says we need to further support the growth of the property industry, which is one of Victoria’s largest employers and contributors to Gross State Product.
“To ensure Victoria continues to receive strong foreign investment flows in the property industry, both sides of politics should commit to making the state’s existing tax thresholds more competitive.”