Chinese buyers shun Australian property, look to Serbia

Chinese buyers shun Australian property, look to Serbia - Google Search

"They are looking for a new status symbol that is no longer Australia," he said.

"With capital transfer restrictions in China, what they can transfer $US50,000, it's barely enough now for a deposit in Australia."

"Rich Chinese are now flooding golden visa programs all over the world. In fact, there is only a handful of programs anywhere in which Chinese are not the most numerous applicants," Juwai.com chief executive Carrie Law said.

Ms Law says however Chinese interests in Australian property won't disappear completely because of China's continued interests in other Australian exports, Ms Law says.

"Everyone knows that Australia owes its wealth to China. China floats Australia’s fortunes up on a tide of cash. Australia's top three exports are iron ore, coal, and education. And who buys these exports? China. Who’s the biggest investor in new housing? China. Whose cheap goods make life easier for Aussies? China’s," she said.

 

actually I can really see them exploiting Eastern Europe it kind of makes sense because there would be a lot less rules about foreign investmentand a lot more corruption and desperation there but yet it's still not completely a basket case like some other countries. As in there's probably some degree of security around the investment.

 

While China is the biggest export market it is not even the third largest from perspective of direct foreign investment. (reference). It is number 5 though which is still pretty impressive.

It’s investment that creates a sustained and stable economic growth and jobs. Long term prosperity is created through investment.

Once you dig deeper you could see that unfortunately while US, UK et al are investing in “positive” investments, Chinese investment favours land and farms.

Finally, news are saying that there are restrictions being introduced in Siberia in regards to Chinese investment. Apparently the environmental impact is huge and people are getting unity of forest being turned into badlands (reference).

The point of bringing Siberia? Like Australia it seems they are restrictions that would be introduced anywhere where capital is not following the rules. Especially if this capital is not deployed into productive assets.

 

Typical comment from a young arrogant Chinese (common).. Australia existed long before any of this "never ending wealth and wonders from china", and could adapt to live without it. In fact, Australia would be forced into new areas, which could have longer term benefit.

 

I think the Chinese have a saying that "One is so desperately poor that he has only money and nothing else!"

 

There is actually a fair bit of truth to it .
It would cause some big problems for our balance of trade figures , and the debt does not change.
If the demand is not there then commodity prices drop.
Every mine has a cash cost to dig up and ship.
Once the cash cost is reached ,its cheaper to leave the ore in the ground and just put the mine into care and maintenance(lots of mass sackings), no more payroll and other taxes, no more royalties and lots of people out of jobs , up to 1000 personnel on the bigger sites.
Why do you think John Howard had so much money to throw around in his last few years.
.He had billions of dollars of unplanned revenue starting to pour into federal coffers , after the dark days of the late 90s when gold was almost worthless(and YES he sold it all off), and Iron Ore mines were barely keeping their heads above water. .

 

Before China there was Japan, Before that there was the US, before that there was the UK. Australia always exported and always people were shouting “If Japan slows we are done!” Japan is in doldrums. Australia is doing just fine. UK is doing not so well. Australia is doing just fine.

The point? After China there are plenty of markets who would be delighted to buy Australian dirt and minerals. See the thing about raw materials is that as long as people consume something. Absolutely something. They are and will be needed.

China or not. She will be fine. People tend to assign more value to themselves than they are worth. Natural tendency.

 

There was a 10 year gap between Japan and China(and a recession) , in the the meantime many many mines closed up , gold fell into a very big dark hole and many mines closed up.
It was the big price drops in Iron Ore prices to Japan around the late 80s and early 90s that caused us so many problems, we had a debt problem after big price rises in Syd, Melb and Perth house prices, and then some really ugly balance of trade figures when Japan fell over. China was still 10 years away.
Gold has risen about 230% since 2000, the dark days were in the late 90s, Iron Ore was in a similar spot.
The reason we had a once in a life time boom , was that many mines had all closed up or running on skeleton crews , many just sacked their entire workforce and everyone had moved on.
When prices started to go back up in the early 2000s it caused a severe labour shortage, seriously pushed up wages and caused a massive boom in real estate in mining centres and in places like Perth.

 

So what? The economy rebalanced. Did Australia go into recession and had no growth ever the 10 year gap? Nope. My uneducated guess stands, China or not, she will be fine.

 

Helped along by interest rates falling from 17% down to about 6%, thats over a 1000pt fall in interest rates for mortgage holders right through the 90s, and then John Howard put another fire cracker under aussie real estate to push things along a bit faster in 1999
At the current level we will be very very lucky to ever see rates drop by another 50-100 pts.
Many family household in the 90s were still on a single wage earners salary, so plenty of room for extra income from a second wage.
If you could not pay a house off in 10 years during this period with 2 incomes, it was generally because of very poor savings habits.

 

It makes perfect sense right? Why invest in oz when yields are crapola and no growth, have I missed something?

 

Don’t be fooled by direct foreign investment stats, a very large amount of that is government bonds purchased through foreign debt custodians in major financial centres. This hides the real owner of government debt from the stats.

 

I’d back Australia as a parliamentary democracy to outlast the current iteration of China under the CCP. They have a 20 year window before going off a demographic cliff, hence the urgency of B&R and SCS land grabs. We just need to be aware of the fifth columnists in our midsts.

 

China birth rate: Mothers, your country needs you! - BBC Newshttps://www.bbc.com/news/world-asia-china-46558562

Shortage of girls entering child bearing ages stemming from the one child policy. Probably a good thing for the environment and the sustainability of the world in general that the population does level off or fall.

India and some African countries, on the other hand, continue to grow in an unsustainable manner.

 

Last recession was 1990s after Japan crashed. Recessions means no growth by the way.

History often repeats, will be interesting to see what happens after China crashes. I call it Japan 2.0.

Of course aus will be fine when the next commodity boom comes along, (in fact iron or prices are at boom time levels now) but there will be a period of pain and we won't be as strong as other commodity countries like Netherlands which have no net debt , invested their profits wisely and own things in other countries. Just look at our interest and bond rates, almost reaching zero soon, we could end up like the PIIGS countries I'm Europe pretty soon.

 

So why aren't African or South American countries rich in resources and low cost of labour not benefiting as much as Australia?

 

stable government and legal frameworks support a healthy business environment for the supply chain. To get resources out of an unstable and unprotected environment you’d need to own it all from security, infrastructure, government officials, maintenance, ports, transport and even then risk is high.

Another thing- Legal frameworks and property rights are drivers for innovation in the west. If you have a great idea, you wouldn’t tell anyone in china and expect it to be protected, the incentive is the national cause. And projects are usually government backed. You’d build a business around it in silicon valley though.

Another way to put it - the West has a supply driven economy. Communism is demand driven. I’m going to make something to sell you that you didn’t know you needed in order to compete for your business. Instead of the people/party needs X so we’ll do it.

 

Don't worry, I have heard stories about the Chinese buy their brides from neigbhouring countries in SE Asia. So, if money can buy "mothers", not sure about love (?), then problem solved!

 

Infrastructure , Infrastructure and Infrastructure and a bit of political stability.
In a lot of these countries, once you get out of the big cities the road infrastructure is shocking.
Much of the mining machinery is big and very very heavy , they do not like going up inclines or declines on the back of low loaders, any sort of rain makes the roads almost impassable if the are not sealed
A 777 cat haul truck for example will weight about 170,000kg , and thats only a mid sized mining truck, even if you take of the tray and and wheels its still a huge amount of weight
The $$$$ cost of sealing roads to many of these sites, and then building a mine , scares off a lot investors and the start up costs can be huge.

 

I think you forgot horrible OHS and collapsing dams. On the other hand there are countries with much more resources than Australia. Way bigger and way richer dirt. Like Russia. Yet, lack of strong and independent judicial power means investors avoid it.