Chinese demand down, but not out, says Investorist founder

Chinese demand down, but not out, says Investorist founder
Chinese demand down, but not out, says Investorist founder

Claims that local developers have left the Chinese market due to a lack of appetite is untrue, according to the founder of off-the-plan property marketplace Investorist.

"The idea that the market in China for Australian projects is over is not just an exaggeration, it's just plain wrong," Jon Ellis, managing director of Investorist, told The Australian Financial Review. 

His website connects developers with selling agents and currently lists about 215 mainly East Coast projects.

He contradicted an earlier claim by Scott Kirchner, a Shanghai-based director of real estate group Beller, in the AFR that Australian developers were not up in China pushing projects and that "Chinese agents have no appetite for Australian property".

An earlier report by Investorist also said that Australia remained the first choice for Chinese property investors, who are undeterred by regulatory changes or global events when it comes to buying property overseas and the trend is likely to continue in 2017.

While Ellis did say that demand from China was down about 40 per cent on a year ago, developers were still going to China to promote their developments and achieving sales.

"We recently achieved 24 sales for a Melbourne Docklands developer. If you have a decent product and are willing to persevere and have a sustained presence in China you will continue to make sales and heaps of them." 

He is taking six Australian developers, including Mirvac and real estate agents McGrath, to Investorist's next China Connection roadshow, which starts on Sunday, having taken five to the last event.

He said the roadshow in the cities of Guangzhou, Shenzhen and Shanghai are platforms for developers to pitch projects to Chinese estate agents.

"We do these roadshows based on demand from Chinese estate agents," said Ellis. "There is still the same level of demand. We have sold out each of our events within three weeks."

At educational seminars held in China, Investorist hosted representatives from 160 companies selling international property, and about 40 per cent expressed strong interest in continuing to buy Australian properties.

"A similar story emerges from our regular China Connection events; approximately half of the Chinese agents attending are there to meet Australian developers. The Chinese agents are attending because Australian property is what their clients are asking for," he said.

While demand from China was down, he said some of this shortfall had been taken up by increasing demand from local selling agents and channels.

"Across the board demand for off-the-plan properties is down about 25 to 30 per cent," he said. 

Ellis said this was due to changes to stamp duty rules that have removed concessions to investors buying off the plan in Victoria and tightening of lending by banks.

Tags: 
Property Investors Chinese Buyers

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