Foreign Ownership

[K3]

While most countries strongly without the ability of foreigners to buy land, here in Australia we actively promote that, for $1.5 million, you can buy your way into both our land as well as permanent residency. The Libs, and it could have been Labor as well, have stated they are going to promote 118 visas even harder to get them up to 150 a year.

What are the upsides?
Money going to the Govt for bonds, as a way to buy your way to a residency. Money flowing into the marketplace through real estate purchases. The Govt may believe these high net worth, mainly Chinese, citizens will be paying lots of tax in Australia but I just can't see that happening.

What are the downsides?
Inflation of housing prices, mainly at the upper end but there is a flow-on effect. Our resources being bought up by people who have no reason to give a toss about what happens to them, and who often actually plan for their usage to be targeted to people from their homeland eg http://www.theage.com.au/victoria/chinese-tycoon-wang-hua-to-buy-macedon-grammar-school-20141220-12b9ct.html

What do you think? Is selling our land a positive thing for the future of Australia?

 

[Giardiasis]

Firstly it's not your land, you don't own it. The resources you refer to are not yours either. Secondly Australia is not a thing, it is an abstract concept, so it doesn't make sense to put the question in terms of the effects on Australia. You can say what are the effects on the individuals that live in Australia?

Pardon me if that all sounded sanctimonious, I didn't intend it to.

 

[Tommy H]

Firstly it's not your land, you don't own it. The resources you refer to are not yours either. Secondly Australia is not a thing, it is an abstract concept, so it doesn't make sense to put the question in terms of the effects on Australia. You can say what are the effects on the individuals that live in Australia?

Pardon me if that all sounded sanctimonious, I didn't intend it to.

Can an Australian buy Chinese property?

 

[tigerman]

There's a lot of rich people, heaps of criminals are rich too. I hope that there is some sort of scrutiny done when these rich people are allowed to buy their way into the country.

 

[martyshire]

I've got so many opinions on this topic I don't know where to start.

You mention house price inflation as a bad thing. I agree with you but I don't think those in control do. House price inflation is something that most powerful Australians stand to gain from. This includes politicians, their mates and their political donors and basically anyone with two properties or more. Both major parties fob off housing affordability at every opportunity. Is it a good thing for people that are fooled into taking on more debt than they can handle if prices ever crash? No. Is it a good thing for young people without wealthy parents or young people with a lot of siblings (i.e. those who can't simply inherit a house)? Absolutely not. Is it a good thing for the fabric of our 'egalitarian' society or the long-term economic stability of the country? I seriously doubt it...but the major parties clearly don't want to stop it.

This is not to say that foreign ownership is to blame for price inflation; but it is surely one of several factors 'to blame' (read 'that have been engineered').

Re foreign ownership, I am ideologically opposed to it but I am also an offender. UK has similar rules re foreign ownership as we do (i.e. not may rules). Three years ago I had enough money for a decent deposit but could not stomach the house prices in Melbourne so I bought in the UK. I would have happily been excluded from buying the UK if the same rules also applied in Australia re foreign owners buying here. My theory re foreign ownership was 'if you can't beat em, join em'. Plus it also happened to make more financial sense for me to invest in the UK.

There are three reasons I am ideologically opposed to the current foreign ownership situation. The first is the contribution towards property price inflation as per above. The second is because I believe selling Australian residency/citizenship to the highest bidder is a terrible way to operate - I don't care whether they come from China, Ireland, Spain or America. Our culture has been hugely influenced by people moving from poverty or conflict to a land where they would have more opportunity. New waves of immigrants had to work hard and were embraced by the community (I realise sometimes it took many years) and I love how multicultural Melbourne is as a result. These days, we tell the equivalent people (asylum seekers) to get stuffed while instead allowing huge numbers of wealthy people, many of whom have no interest in engaging with Australian society, to simply diversify their international assets and take up prime space, as long as we can take a cut. As a country, it is a selfish way to operate and I think we can already see signs of us becoming a more selfish, disengaged society as a result.

The third reason is I think our huge population growth, (which only masks - no solves - issues in our economy) is unsustainable without huge improvements in infrastructure, a changed way of thinking re transport and/or people generally being prepared to make compromises re their current way of life and standard of living. Quite frankly, I don't think most people are ready for this; even in cosmopolitan Melbourne.