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http://www.stuff.co.nz/business/ ... ment-just-beginning
Chinese investment in the New Zealand property market is only just beginning, a Chinese property investment expert says.
Juwai chief executive Simon Henry told TV3's The Nation that in the last three years Chinese investment in overseas property had taken off and would only become more common in the future.
"Three years ago, it was probably $10 billion globally. Last year it was approximately $52 billion globally. We're seeing a net increase of roughly 15 to 20 per cent per year, expected for 2015, 2016."
Juwai marketed itself as the company Chinese go to to find international property. It has 2.4 million listings from 58 countries.
Henry said New Zealand was the seventh most popular country searched for on its platform, with a lot of that attributed to proximity.
"Australia is the second most popular country in the world for the Chinese buyers.
"New Zealand [is in] a similar time zone. It's only about eight or nine hours travel down from China to Australia or New Zealand. And if you're sending your kids overseas to study, it's only a two or three hour time difference in terms of telephone calls and contact.
"New Zealand's also got a fantastic reputation in terms of produce, education, lifestyle and tourism. And so New Zealand has a very good brand reputation."
The average spend for those investors was roughly $1.4 million, or about double what a first-home buyer or a domestic buyer would purchase, he said.
However, New Zealanders should not be afraid of being pushed out of the market, he said.
"It's very interesting to draw parallels to the recent Parliamentary inquiry which happened in Australia on this exact topic.
"The findings of the inquiry were that foreign investment, first and foremost, is very good for the domestic economy; it helps create jobs and also it helps create supply.
"Secondly, it also adds a lot of supply to the domestic marketplace, which would otherwise not be added.
"And third, they found that it actually keeps prices low, because without the foreign investment, there wouldn't be new supply, which would actually drive prices even higher."
He pointed out that Chinese investors made up only 25 per cent of all foreign investment in the New Zealand market, so focus should also go onto the other 75 per cent of investors from other countries.
He supported a register of foreign buyers as he said it would help New Zealand understand who invests in the country.
"Generally, by global standards, roughly five to 10 per cent of the property markets globally are to foreign investors, and I think New Zealand is currently sitting at about 8 per cent, so well within the range.
"Having more data and more knowledge about what's happening in local industry I don't think would be harmful at all, and it actually could be quite beneficial."
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