Nation Master, Author at Microburbs Blog

It can be pretty frustrating trying to buy Australian property in areas popular with the Chinese buyers. Sydney, Brisbane, and Melbourne are seeing Chinese money pouring into realestate with no sign of a slow down.

While there has been some public backlash and a crack down on agents skirting foreign investment rules, the boom is making some lucky Australian property owners rich. Whether your plan is to benefit from Chinese-driven capital gain, or simply to avoid areas where you are likely to be outbid, it helps to understand the demand factors.

Here are the top five things Chinese investors look for in Australia.

1. Close to top schools and universities

Asians value education highly and the Chinese are no exception. Not just any school or university will do. The presence of top schools or an elite university in a suburb will rank it highly. Wealthy Chinese are buying property for their children to enjoy while they study abroad.

2. Prestige and respectability

The Chinese buying in Australia are proud of their success and wealth. They want to own and live somewhere that reflects their status and taste. Established, leafy, highly respectable suburbs, and modern, luxury condominiums are the go. Don’t expect cashed up Chinese investors to be interested in helping to gentrify down-market suburbs.

3. Cultural fit

Every capital city in Australia now has suburbs with a high proportion of Chinese born and Chinese speaking residents. For example Chatswood, Sydney, Doncaster, Melbourne, Sunny Bank, Brisbane. In these areas shopping centres, restaurants and other amenities cater to the Chinese population.

4. Iconic views of Sydney Harbour

The hottest properties in Australia right now are mansions and luxury apartments with Sydney harbour views , ideally of the Opera House and Harbour Bridge.

If you are lucky enough to own such a property, you are likely to be receiving offers from Chinese buyers that are increasingly hard to refuse. But you might be crazy to sell.

5. Feng Shui

Good Feng Shui is important to many Chinese buyers. Aspect, position in the landscape and the number will be considered. The number four could be a deal breaker because it sounds like death in Cantonese. If a complex you are inspecting has no floors or unit numbers ending in four, you know who the target market is.

It’s easy to be fooled by a suburb name. Even very expensive suburbs have bad neighbourhoods. It could be a busy road, a public housing block or a noisy hotel. If you bought there before finding out you probably don’t want to talk about it until you can sell.

Buying a cheaper property in a bad location within an upmarket suburb can work out ok for investors but can be an expensive mistake for owner occupiers.

Joy Tan from Hawk Eye Finance, a Sydney mortgage and property advisory firm, says that staying fixed on a particular suburb is dangerous in today’s rising market.

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Joy Tan, Managing Director of Hawk Eye Finance

“People are being pushed into property they normally wouldn’t consider because they are priced out of the ones they prefer. There are some things it’s not sensible to compromise on. Looking a bit further afield can save you financial stress and help you secure a home that will meet your needs for many years.”

She says that everyone has different needs and that most clients tend to look in too few suburbs.

“The trick is to narrow your search to the kind of neighbourhood that’s right for you but be open minded about the suburb. If you want peace and quiet you might want to avoid schools and young families. If you are at the child raising stage of life, good schools and neighbours with kids who you are happy for your kids to play with are going to be a priority. I advise people to write down their criteria with regard to commute, services, education, local culture and so on.”

She says that research to find suitable neighbourhoods is time well spent. “There’s the ABS statistics, Naplan for schools and a range of other sources to find the gems. The important thing is to be clear on what you need and realistic about what you can afford. That will help you to focus the research process.”

Five reasons the Chinese Nouveau Riche want your home

The inconvenient truth about suburbs