Why the Significant Investor Visa is the fine wine of visa programs
GUEST OBSERVATION
Like cheese and wine, but not – unfortunately for me – brains or biceps, the Significant Investor Visa improves with age.
Now that it has celebrated its first birthday, Australia’s visa program for immigrants willing to invest $5 million in the lucky country can be judged a roaring success.
Back in June, 2013, some observers called the Significant Investor Visa “more hype than reality”. Well, bloggers for Property Observer seldom make mistakes, but that was a big one.
It is not by accident that 90% of the applicants for the Visa come from mainland China.
It turns out that the visa wasn’t over-hyped, it was just getting started. Even Usain Bolt had to learn to walk before he could run.
Here are the latest figures for the program, as provided to me by the office of the Minister for Immigration and Border Protection, Scott Morrison:
• Rich would-be immigrants have lodged more than 600 applications for the Significant Investor Visa.
• 91% of these wealthy applicants are Chinese.
• 88 visas have already been granted.
• The investments the current batch of applicants have proposed add up to nearly half a billion dollars in new activity in Australia.
Some lampooned the government of the time for giving the Significant Investor Visa the official name of "Subclass 888.”
Looking back, using these numbers seems inspired. Triple eight is the luckiest combination of digits in Chinese numerology – and a potent symbol of prosperity in Chinese culture.
It is not by accident that 90% of the applicants for the Visa come from mainland China.
The fall of the Australian dollar has also favoured the Subclass 888 visa. Over the past year, the amount of Aussie money it takes to buy 1 Chinese Yuan has steadily increased.
The reverse is also true, and Australian dollars have gotten cheaper for anyone holding Chinese money. From the perspective of Chinese investors, that means an investment of AU$5 million has gotten steadily smaller in their own currency, so that it starts to look like a bargain.
Real estate agents are seeing the impact.
Georg Chmiel, CEO of the LJ Hooker network, told me this: "Our LJ Hooker offices are increasingly fielding calls from Asian nationals looking to buy a trophy home for when they are in Australia.”
He also said that, on an international stage, “Our real estate represents value for money. We have a transparent government and stable economy.”
Another real estate leader I spoke to recently agrees. Michael Davoren, Managing Director of RE/MAX Australia, told me that his network is also getting many inquiries from Chinese buyers.
“There is significant representation in these inquiries for premium properties that could serve as residences for beneficiaries of the Subclass 888 investor visa,” he recently emailed me.
So, the next time a vendor asks you if the Significant Investor Visa is having an impact, tell them that – notwithstanding what they may have read – the answer is “Yes.”
Andrew Taylor is the Queensland-born co-CEO of Juwai.com, the number-one Chinese real estate portal for property in Australia and around the world.
He has almost a decade and a half of experience in Australian and Chinese real estate and managing print, TV, radio and online media. He also has bachelor and graduate degrees in classical music, and plays the diyin gehu (Chinese bass).