Chinese buy $5.9 Billion in Property Australias Gen-WTHH forced to Rent

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It’s obvious that an entire generation of Australians are being priced out of the property market, and many will face the sad reality of life renting Australian properties from their Chinese landlords.

The strong demand from overseas buyers, the higher the prices will go, and the harder it will be for poor young Gen-What-The-Hell-Happened (Gen-WTHH)

The great Australian dream looks to be fading fast?

According to data from the Australian Bureau of Statistics (ABS) and the Foreign Investment Review Board (FIRB) it is estimated that the Chinese are buying 18% of the new dwelling supply in Sydney, and 14% of the supply in Melbourne.

Wealthy Chinese buyers have purchased $24 billion of Australia housing in the past seven years, and over the next seven years an additional $44 billion will be spent on residential property, Credit Suisse estimates.

Chinese top the list of foreign investors in Australian residential property.

First-home buyer activity, as a proportion of total borrowers, is near record lows at 12.7% of total loan approvals, according to the ABS.

First-time buyers in February comprised less than 10% of all mortgages processed by mortgage broker AFG for the first time since June 2010.

The numbers are the most dramatic in NSW where first-home buyers make were responsible for just 3.4% of AFG mortgages, down from an already very low 4.5% in February last year.

Victoria’s first-home buyers took out 10.3% of mortgage, down from 17.1% last February.

Over the last 12 months, property prices in capital cities have jumped 10%, according to the RPData-Rismark home index.

The rise was most severe in Sydney, where prices rose 14.6%, pushing the median house price to $746,640.

Chinese buyers are currently spending $5.4 billion a year on Australian properties, with the split relatively even between new settlers and others, which include investors, developers and temporary residents.

Adding to the purchase of new property, the latest FIRB report showed in 2013 that there was a total of 5101 approvals to buy existing property worth $6.36 billion, which was up more than 50% from the previous year.

In the financial year ending June 30, 2013, there were no rejected proposals in the real estate sector, compared with 13 in the prior year.

In total, there was $51.9 Billion in approved investment in property, with $5.9 billion coming from China, a 42% increase from the year before.