Sydney Harbour Photo: Wikimedia Commons
Foreign investment has become a subject of heated debate Down Under, as locals fear that international buyers are pricing domestic house-hunters out of the market. But new figures highlight just how big an impact foreign money has had upon the country’s economy.
Indeed, an apartment building boom, heavily funded by the Chinese, has contributed more than a fifth towards Australia’s economic growth in the past two years.
Approvals for apartment projects have almost doubled since 2012-13, notes The Australian , with units accounting for 95 per cent of that rise in construction activity.
Deloitte Access Economics partner Chris Richardson says housebuilding is “important” at turning points in the economy, because it is a volatile sector.
“At its low in 2012, it fell to 4.5 per cent of GDP but it’s already up to 5.5 per cent of GDP, so one percentage point of growth has come from a tiny sector,” he told The Australian.
Indeed, consturction workforce has risen by 40,000 in the past two years, the opposite of the downturn occuring in the mining workforce, as the country’s economy appears to shift from one industry to another.
The major retail banks, though, are only involved in around a third of developments in Melbourne, meaning that foreign investment is driving the remainder.
Colliers International says that it has just sold three separate apartment developments in Sydney for more than $150 million each.