Whilst the accompanying article is mainly addressing commercial transactions, the simple fact is that it is getting harder for Chinese buyers to move money out of China. So why should we care? Because it has a direct impact here on our local residential market.
In the Eastern suburbs of Melbourne, this source of funds has been an important component of price growth over recent years. Sure, there are other important factors, such as interest rates and bank lending practices but any one of them can destabilize the market. All three have started to impact on demand now.
But on the other side of the equation, with low supply of property, combined with historically high immigration into Victoria (read Melbourne), growth so far has simply slowed, not stopped. For both buyers and prospective sellers, this is a pretty good situation; not too hot and not too cold – just about right. Don’t pay too much regard to the latest weekly or monthly statistics we seem to be bombarded with; momentum is slowing and with a little bit of luck, we might just get the Goldilocks outcome.