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This is Why Australia Hasn't Had a Recession in Over 25 Years (bloomberg.com)
Australia is close to seizing the global crown for the longest streak of economic growth thanks to a mixture of policy guile and outrageous fortune. From a report: While growth is being underpinned by population gains and resource exports to China, failure to spur productivity has meant stagnant living standards and electoral discontent; a property bubble fueled by record-low interest rates has driven household debt to levels that threaten financial stability; and a timid government facing political gridlock could lose the nation's prized AAA rating as early as May because of spiraling budget deficits. Australia's last recession -- defined locally as two straight quarters of contraction -- occurred in 1991 and was a devastating conclusion to eight years of reform designed to create an open, flexible and competitive economy. But it also proved cathartic, paving the way for a low-inflation, productivity-driven expansion. As momentum started waning, China's re-emergence as a pre-eminent global economic power sent demand for Australian resources skyrocketing, helping shield the nation from the worst of the global financial crisis. But the post-crisis return of the boom proved ephemeral, failing to boost government coffers and pushing the local currency higher, eroding competitiveness and driving another nail into the coffin of a fading manufacturing sector.
There's rather a disjunction between the rah-horray headline and the text, which seems to be about how Australian economy is heading for a major bust. "Failure to spur productivity has meant stagnant living standards and electoral discontent; a property bubble fueled by record-low interest rates has driven household debt to levels that threaten financial stability; and a timid government facing political gridlock could lose the nation’s prized AAA rating as early as May because of spiraling budget deficits."
The answer to the question posed in the title seems to be "because Australia is close to China, so when the rest of the world economy hit a depression, the Australian economy was buoyed up by the Chinese money."
http://www.geoffreylandis.com
They're mining their natural resources as fast as they can and replacing it with... nothing.
High value currency is what you strive for, not low currency. See Zimbabwe, Argentina, Weimar Republic, and every other country who's had a currency collapse. High currency does not erode competitiveness, why weren't Zimbabwe and Weimar Republic more competitive when their currencies went to 0? Think of it this way, would you hold bitcoins if it dropped in value everyday? Or if it could be mined to infinity by politicians who think it's "too expensive"?
Complete right wing rubbish, the reason we got thru the GFC without recession was the governments prompt stimulus actions at the time.
The housing bubble is not due to supply, there are many vacant investor properties, it is the ridiculous negative gearing tax dodge that is fuelling the housing price problems.
It was our first house, and my partner was a lot more risk adverse than me. She insisted we be prepared for one of us being out of work and interest rates doubling. Both happened. I changed careers to IT and it took me nearly 2 years to get work, while interest rates went from 9% to 18% in a matter of months.
We managed to pay the mortgage and keep the house, but it was not a fun time.
To know that you know what you know, and that you do not know what you do not know, that is true wisdom. --Scooby Doo
I've posted this maybe dozens of times across the internet, I'm tired of shouting it and I'm tired of making lengthy posts with links and evidence.
The country is selling all it's gas, minerals at rock bottom prices to anyone and everyone for a start. In a huge massive way. The mining boom is finally slowing down significantly, at least so I hear.
We are also pretty lax with stopping people buying property. There's arguments why shouldn't we stop them, but seriously, I'm sick of debating it. If you can't see how someone vastly wealthier than the common local, bidding for houses isn't going to mess up the cost for the locals,..... well I don't know what to say. There's a reason Thailand, Indonesia, other smaller second class countries don't let foreigners buy.
We're getting 'Vancouvered'. It ain't about race, it's about economics and the locals (who don't own yet, you know, a LOT of people) are getting destroyed, totally by this.
That's the facts, it's as simple as that. Furthermore, as long as the Chinese can still buy property (and they do it legally and illegally) then I suspect the 'crash' which I've hoped for, for a decade, simply won't come. They'll just see a cheaper place to store their money they want to hide from China.
We're boned. Best benefit to all this would be a property developer in the last 20 years. Rest of us? Well I've held off using expletives but to say I'm white hot raging angry would be an understatement. @$#%^ our governments.
... More shrimp on the Bar-B. G'day.
It's because most middle and lower class Australian homes have solar and wind power, and fairly efficient hot water boiling carafes, so they don't need to go broke importing stuff and mostly export stuff.
Like coal.
Which is dying.
So, when the bubble bursts, it bursts because they export stuff we won't be needing and they can't save money by becoming more efficient.
-- Tigger warning: This post may contain tiggers! --
+1
Believe nothing for the next 48hours.
The country is selling all it's gas
You're not wrong. What a wonderful example of a free-market economy. A small localised gas supply at relatively cheap prices made using gas for everything affordable. Even cars were converted to run on LPG to save costs.
Fastforward to now. Shale gas has boomed. Australia sold it's own grandmother to gas companies for a penny and we became a huge exporter of gas able to rival Russia and the middle east. Everything happy right? Except Australiasian gas prices fell to below the break even cost of the shale gas but thanks to pre-existing contracts with China and Japan they couldn't just stop production without a penalty. Wait a second, it's a free market! Just buy all the local cheap gas and sell it overseas instead of the shale gas.
No money for the government, no gas for the people, but a few oil companies are able to stay afloat despite their shitty business decisions. The economy is still running and the government pat themselves on the back for not going into recession even though they have no handle on the situation at all.
Hurrah!
I've posted this maybe dozens of times across the internet, I'm tired of shouting it and I'm tired of making lengthy posts with links and evidence.
The country is selling all it's gas, minerals at rock bottom prices to anyone and everyone for a start. In a huge massive way. The mining boom is finally slowing down significantly, at least so I hear.
We are also pretty lax with stopping people buying property. There's arguments why shouldn't we stop them, but seriously, I'm sick of debating it. If you can't see how someone vastly wealthier than the common local, bidding for houses isn't going to mess up the cost for the locals,..... well I don't know what to say. There's a reason Thailand, Indonesia, other smaller second class countries don't let foreigners buy.
We're getting 'Vancouvered'. It ain't about race, it's about economics and the locals (who don't own yet, you know, a LOT of people) are getting destroyed, totally by this.
That's the facts, it's as simple as that. Furthermore, as long as the Chinese can still buy property (and they do it legally and illegally) then I suspect the 'crash' which I've hoped for, for a decade, simply won't come. They'll just see a cheaper place to store their money they want to hide from China.
We're boned. Best benefit to all this would be a property developer in the last 20 years. Rest of us? Well I've held off using expletives but to say I'm white hot raging angry would be an understatement. @$#%^ our governments.
Oh please, spare us your xenophobia. I have heard such sentiments in the late 80's and 90's when the Japanese were on a spending spree. Everyone were concerned by the Japanese buying up American assets while conveniently ignoring that citizens and business entities of the UK owned more assets in America than the Japanese. I wonder why people were concerned about the Japanese and not the English. On second thought, I know why. Those other counties, you mentioned, preventing Chinese from buying property are xenophobic as heck against the Chinese and a sad day if America follow suit. Foreign entities wanting to buy assets and invest in America is a good thing.
It has to do with economics, not race. It's not logical to sell out property and land to foreigners, period.
However I've triggered some kind of angry extreme leftist rant, which I'm not surprised, there's still a couple of you guys left coming here. I used to be one of you!
Anyhow, good day, I'm not even going to waste my time replying to the points in your post, if you can't understand what I wrote the first time, you'll hardly understand the second.
I'll let the moderators deal with the problem.
I just had a gorgeous Akubra hat sent over. It was 20 days in L.A. customs but I finally got it.
The Australian Government's (both Labor and Coalition) over the last 15 years have conspicuously failed to support the automotive industry in the face of the high exchange rate caused by our enormous mineral exports. This is in opposition to the way they supported the banks via all sorts of funny schemes.
As a result Australia is the only country I have ever heard of which has decided that the auto industry is not a good idea.
So first the assembly workers went. Then the factories went. That meant there was no critical volume for precision machining, so then the toolmakers went. That meant the local aircraft maintenance industry couldn't get the stuff they needed, so aircraft maintenance was offshored. Meanwhile all the suppliers of parts had to diversify into less rigorous but less profitable lines. So the engineers went.
I'm lucky, we still design and develop cars for manufacture all over the world (except in Australia), so our product development centre is expanding.But an industry that used to employ around 50-100 000 well paid highish technology or skilled jobs is practically dead, with maybe 2000 people left.
So escaping the GFC probably is not due to the incredible foresight of the gummint, just lucky.
then I suspect the 'crash' which I've hoped for
I wouldn't hope for any crash, much less a property crash. Just remember what happens when prices come down. It sound great for a new home buyer, but well didn't we just witness what happened in 2008? A sizeable chunk of the population not being able to afford their houses as interest rates spike and the investment value crumbles has a horrible effect on the economy.
You're holding it upside-down mate.
Have gnu, will travel.
Sounds like it is about race.
I no longer care, I couldn't care less.
Fuck them all, a generation (or 3!) have been fucked by the Australian government policies and I want to see it all crumble horrifically.
There's far too many "interest only loan" investors with 2,3,4 properties, reducing their taxable income (google: "negative gearing" a true scam for the rich).
Nope the middle class, the young and a small handful of the cautious middle aged (me) have been ruined. Let it fall to utter pieces.
One particular race is by far the most common, because they are now,
a) rich
b) there's over a billion of them
c) in a country which has inferior health care, schools, breathable air
d) in a country where the government can take their money at will (historically)
The problem is *primarily* Chinese investment. You could re-word my post to say "foreign investment" and remove all elements of race in it, it wouldn't change the fact it's *by far* Chinese investment and even the pro housing blogs, news articles, cite the Chinese as "keeping us going, yay!"
At the end of the day *as stated in my damn post* huge swathes of money coming in from another country, into housing is extremely detrimental to the locals, period.
Some of the labour laws in Oz are also unreasonable on the employer.
- Leave loading (yep, that's right. 10% extra pay when on holiday)
- 9.5% compulsory superannuation.
- Casual employee loading on top of the minimum wage, where 25% might be normal.
- Obligations to track payments to building contractors, and a judgement to pay tax on their behalf if not tracked properly
- Paid "Personal Leave" which goes above and beyond sick leave
- Huge fringe benefit tax obligations. Not just for cars and fuel, but interpretation of when the car can't be used, travel etc.
- All of this on top of a necessary high basic wage and minimum wage, needed partly because of property prices.
It is really complex and expensive to use Australian labour.
LOL.
The only reason anyone made it through the GFC was because Obama (which inherited the mess) fired up the money presses and kept liquidity in the economy. If not for that it could have been decades long, the only thing that fixed the great depression in the 30s ultimately was WW2.. because ta-da the government starts spending up by building lots of stuff, thus putting liquidity into the economy.
Australia is not special, its just been riding an almost never ending mining boom with China.
Quick question for you.
1) The US pretty-much doubled federal spending in order to get us out of the depression, putting us now $20 trillion in debt.
2) Depressions seem to come roughly every 8 or 9 years. Call it every 10 years.
3) When the next depression hits, will the US have had enough time to pay back the extra debt?
4) Are steps 1-3, a sustainable plan for shortening recessions going forward?
Extra credit:
According to your post, the US helped *everyone* through the depression. Was the extra debt borne by everyone, or only the US? Will foreign citizens help us pay back the money we spent to help them through, or only US citizens?
Was the extra money spent on things that would make our economy stronger, such as infrastructure, high-speed internet access, health care, or research? Or was it spent to expand the military (as in: number of aircraft carriers)?
Spending all that money, is the economy sound or are we just limping along? Are we back to the pre-depression unemployment levels and wage levels?
Would it have been better to simply let the banks fail, so that the depression was worse but much shorter? Did any other countries do this, and what were their results?
Not sure about Australia, but here in the States the trouble is we keep giving our upper class massive tax cuts. Then we don't cut services (because if we did people would demand we repeal those tax cuts) and instead borrow the money. The idea is the system will eventually collapse and the rich will swoop in during the chaos and take control of the country. I'd like to think we'll be smart and stop that, but so far no such luck.
If you guys are going through this then my apologies. Your ruling class learned it from ours.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
No. The Chinese alone are not responsible for exorbitant Australian property prices. They are just one of many factors. Larger factors include generous tax concessions (negative gearing and capital gains discounts) and the role of property investors (mostly mum's and dad's) buying their second (or more) property. Possibly the biggest factor is that everyone want's to buy in the inner-city areas of Melbourne and Sydney due to poor infrastructure and jobs growth outside these areas. House prices in other Australian capital cities are much lower in general and rarely in boom conditions.
Look at this article from the Murdoch press (aka. right side of politics) chinese property investment in Australia its a more balanced view of the effect of Chinese property investments.
Your parochialism is astounding. Give the Chinese more incentives to come here I say, they're bringing much more value to Australia than your typical 'local'. Your argument is petulant and short sighted, we live in Asia and should become more Asian because the future is in Asia
Bear in mind the subject of this Slashdot article, it's not so much about the prices only, it's about the lack of a recession.
Rising property prices with no external influx of money wouldn't shield us from a recession, selling all our resources and allowing huge amounts of foreign investment however would grow or at least reduce stagnation of the economy.
Totally agree about negative gearing, it's disgusting, no other word for it. None the less the foreign investment thing is huge.
Also general overall massive immigration, my understanding is that this boosts our overall economic figures each year as we've got more 'turnover' for lack of a better word. Not looking at the overall average wealth / buying power of a typical middle class Australian, which is infact slowly eroding and has been for a while.
Yeah globalist cunt .. get with the plan. Historians observe you are either zeno 24/7/365 or you are pighit for the wealthy. Make a nationalist choice or get put-down as citizens enemy ASAP.
Yep, that makes sense, if you didn't buy a house in the 90s "fuck you" response. Very typical and unsurprising whatsoever.
Also, not all of the Chinese investors come here, where did I claim that? Quite a few buy here and don't come, the unoccupied house is simply, effectively used as a "physical bank" to keep cash out of China.
http://boingboing.net/2017/03/...
You people are never ending. "Fuck the losers who don't have a house", who cares if they are only 18 or 23 or 25 or even 35. Nope fuck em "should've got one sooner, this boom is great!!!! "
Just stop.
Foreign investment is a factor, but nowhere near the biggest one is.
The shift from having pensions to superannuation, and the implementation of negative gearing are the biggest issues. Owning multiple homes has become the retirement plan of most of the population. Our politicians (including our prime minister) are some of the largest property investors in the country. We have a level of plutocracy on par with Columbia, and property developers are making a killing. Several IT people I know have already given up on buying a home.
Negative gearing is the really absurd bit though. Friend of mine had so many properties, and so much debt that the government was paying him a hardship allowance. He lives in a 3 story, 50sq mansion relatively close to the city. His top story "man cave" is bigger than most 3br apartments in the city.
To know that you know what you know, and that you do not know what you do not know, that is true wisdom. --Scooby Doo
One Trillion dollars of national debt.
That's the real cost of the longest stretch of increasing corporate profits and greed ever.
The real estate market is a ponzi scheme, propped up by tax dodges instituted by the Howard government.
When we say the mining boom is over, that's just the construction phase,
now they're extracting and exporting, so minimal local jobs for maximum multinational profits.
The costs of development are offset against taxes so the multinationals will reap years of tax-free profits.
The (Liberal or Labour) government is directed by it's corporate overlords.
We're being held upside down and all the pennies shaken out of our pockets.
Go well
I totally agree with you, but bear in mind the subject of this particular article.
I covered this here.
https://yro.slashdot.org/comme...
Also bought a house in 1990, that was a painful time. Can't imagine losing a job as well.
Task Mangler
I'd agree. I grew up in NZ, the housing market took off in my early 20's, by my mid 20's it was too late, you needed two decent incomes to buy anything. The GFC in 2008 did nothing to stop it. There is absolutely no hope for anyone to afford to buy a house on the average income now, its a lost dream.
I suppose I got lucky and met a gal from the US when I was roaming around Canada on a working holiday visa in 2010. By 2014 we'd gotten married had a kid, and bought a house about 35 miles south of Seattle - here is the kicker - we did this on my one income, and got a place on a nice street on a 1/4 acre lot for just over 200k. Thats what it should be like in Australia and NZ, afford a half decent house on one income.
Much like your self, I got pretty fed up with the smug attitudes of people there were able to get into house ownership before it took off, or had a golden egg from their parents to help. Even worse are the f***ers that own 2 or 3 houses that smile all the way to the bank like its a well deserved gift from God.
The real reasons are pretty simple :
1 - Free-market reforms in the 80s and 90s that liberated the economy by the Hawke and Keating governments : https://en.wikipedia.org/wiki/Hawke%E2%80%93Keating_Government
2 - A long-running commodities boom fuelled by demand from China, which Australia was well placed to satisfy due to abundant natural resources.
It has to do with economics, not race. It's not logical to sell out property and land to foreigners, period.
It has NOTHING to do with economics, and it is foolish NOT to sell out property and land to foreigners, period.
Land is the ONLY thing that foreigners can buy but cannot take back home. A foreigner buying land in one place has only two choices --rent it to locals at the market price, or not. The latter means they just spent a bunch of cash for zero return (actually negative if there is any tax or fees owed to government).
If you are going to retort high land price will drive up the rent price, go learn some basic economics. Or even better, go buy some land in the middle of nowhere to drive up the land price then watch the rent go up, and remember to hold your breath while waiting.
Real economic activities drive up rent prices, that's why buying up property in ghost towns won't drive up the rent price. When there is no one is looking for a place to rent, rent price can't go up no matter how much the land cost.
So buying property in a place is essentially betting that the place is going to have more economic success, and foreigners buying property in your city means those foreigners now have a vested interest in your city's economy going well, that will never hurt.
Furthermore, the previous local owner, now having sold his property to a foreigner, now have the cash to invest in something more profitable (else he won't be selling in the first place). That's more profit for the *local* ex-owner, and if he invests locally, then more locals get to benefit. So you are effectively getting foreign investments when a foreigner buy local property, and unless you are xenophobic, foreign investment is always a good thing to the local economy.
Race is the only real reason for people to fight against foreigners buying land and local properties.
Chicken, meet egg.
When people buy properties, property prices rise as the pool of available properties drops. Basic supply and demand. The remaining, price-inflated properties are no longer able to be purchased by people that need to own them as they can't afford the inflated price/deposit/mortgage, leaving them no choice but to rent. This increased demand for rental properties pushes rental prices up. More basic supply and demand. And with inflated rental prices, these same people (the average working Joe) are even less able to meet the price/deposit/mortgage requirements to purchase as they're now blowing a greater portion of their incomes paying off someone else's mortgage, be they local or foreign owners.
But let's not let basic mathematics get in the way of ideology.
Chinese invest in property as a physical bank. They don't care about return, except for when they decide to sell. They've even done it in their own country, building row after row of high rise condo in ghost towns which sit empty, at incredible damage to their own economy. You think they give a shit about other economies? Artificially driving up the price of real estate only helps the early comers. That is how they get their return.
Resources have saved Australia's bacon many a time, hence the term "The Lucky Country" was coined in the 1960's (although not in a positive light). The only reason Australia avoided the GFC is because China started developing their internal markets for their products causing another boom in manufacturing there which meant a continued demand for resources. Some people claim that it was just the Australian govt's fiscal policies that saved them. If that is the case then how come Brazil was booming at the same time? Anyway Australia is the Saudi Arabia of the Pacific, but instead of Wahhabism being the dominant religion it is materialism, oh and hating refugees of course. Unlike Saudi Arabia, Australia isn't doing anything to wean themselves off selling everything, so one day...... People complain how bad Trump is regarding refugees, but have a look at what Australia does to them and how it makes Trump look like a bleeding heart liberal. It doesn't say much for the people who keep voting for this.
Oh please, spare us your xenophobia.
If I said the population of Africa is mostly black is that xenophobia? No? Then why is pointing out the simple fact that there is an incredibly large institutional investment from Chinese non-residents of Australia in the country?
I mean every major skyrise construction is bought out mostly by Chinese non-residents. Whole suburbs in major cities have been bought and build by Chinese non-residents. The two largest cattle companies in Australia have been bought out by Chinese consortium. The largest property in Australia (the size of Israel) was bought by a Chinese consortium. And let's not forget the all their investment in our dairy industry, coal industry, telecoms, ... they'd own it all if it weren't for the fact that the government keeps coming up with new laws limiting foreign ownership (and good-on-em as well).
I wonder why people were concerned about the Japanese and not the English.
You may wonder, but you don't know despite what you claim. There's a big difference between having foreign ownership from a country who is a close ally, has strong political ties, similar financial systems, and works on the same principles as yourself, vs a country who you will quite likely be at war with again within the century, who you have strained political relations with, and who you accuse of and constantly take to the various trade organisations of deceptively rigging their financial and trading systems. China is economically hostile, just as Japan was in the 80s.
The fact that you put this down to xenophobia is just an amazing display of ignorance.
and I want to see it all crumble horrifically.
Yeah before you do, let me move my pension and all my other investments overseas. You want to shoot yourself in the foot then go right ahead but please don't get blood on everyone else.
google: "negative gearing" a true scam for the rich
Taking a loss on an investment and offsetting it against the tax you pay is a scam? I find it funny you think it's a scam for the rich since they don't pay enough taxes to offset for negative gearing in the first place. Also those with 2 3 4 investment properties driving up the prices? Well a large portion of that you can thank to Chinese non-residents who can't negatively gear anyway. Negative gearing is nothing more than the same deduction applied to every single other thing you do with your cash. Your company makes a loss? It's deducted from taxes. You spend more on education than you get from it? It's deducted from your taxes. Hell you get medical insurance, it's deducted from your taxes.
But yeah whatever man. Enjoy your next major recession. Just don't go begging for a handout since you want it so badly.
Starting with X properties available for rental and Y people wanting to rent. Now Z out of X properties were bought by foreigners, leaving... exactly X properties available for rental, and exactly Y people wanting to rent. Everything the same as before, except the price of the Z properties are now cash in the hands of locals.
People who would have bought a property and now chose to rent will take exactly 1 property out from X in either case, leaving X-1 for the rest.
Yeah, right, don't let basic maths get in the way of xenophobes.
Unless you have properties being bought and deliberately left vacant, a property changing owner will have ZERO effect on the rental market. In fact, foreign investors prefer properties that comes with tenants, so they can receive return on the their investments right away, having nil effect on the rental market.
didnt go fixed rate?
Wow, really? No.
.Plenty of water and improved CO2 levels mean less CO2 starvation for plants and better growing results.
I don't subscribe that the historical CO2 levels have been reported, correlated and projected accurately (e.g. Antarctic levels, cores are lower than arctic levels but not noted) nor do I buy the proposed CO2 accumulation levels, due to actual kinetic measurements of CO2 lifetime. This independent of the CO2 itself causes catastrophic warming discussion.
Another bullshit thing about banks in Australia and NZ - they dont fix the rate for the life of the loan like you can in the US. They let you fix it for a few years then you have to redo it again, and again, and again, if interest rates take off you are f***ed.
We bought a house in 2014 in the US, the interest rate for us was 4.85%, and it'll stay at that for the life of the loan unless I choose to refinance it.
In those days, banks didn't throw money at you like they do now and fixed rate loans were hard to get when you were in our 20s.
To know that you know what you know, and that you do not know what you do not know, that is true wisdom. --Scooby Doo
Housing in Australia has several components to it which I will try to cover in this post. I live in Melbourne Australia and I want to provide insight to people interested in learning more. 1. The 1980s Hawke/Keating Market reforms set the country up for the past 30 years of economic growth. Anyone denying that is crazy. They floated the currency, freed up the market for global trade and set the nation on a path to long term wealth. They did however over stamp on the breaks in 1991 causing a short recession. https://en.wikipedia.org/wiki/... 2. Negative Gearing and the Capital Gains Tax concessions are two massive tax breaks for existing home owners. Their effects are huge and not to be underestimated. Negative gearing allows any loss on a property such as repair work or investment loss to be written off against the owner's taxable income. Originally it was introduced to boost investment in the housing market. The Capital gains discount allows a property owner to not pay tax on 50% of their profit on a property when they sell it. In the current market this has created a situation where it is better to leave a property empty, appreciating in value and then sell it without the hassle of dealing with tenants and property management firms. http://www.abc.net.au/news/201... 3. Foreign investment. Market research data from Vancouver shows that implementing a 15% tax on foreign property investment caused a property price drop of around 20%. Where that money is coming from doesn't really matter, the point is that foreign investment accounts for approximately 8-11% of properties purchased in the market. https://www.bloomberg.com/news... 4. Recent studies of water usage in Melbourne and Sydney show that upto 80,000 properties in Melbourne alone lie vacant. http://www.heraldsun.com.au/ne... and http://www.afr.com/real-estate... 5. Immigration, 182,000 people migrated to Australia in 2015-16 the 2016-17 stats are not available http://www.abs.gov.au/ausstats... This is a large number by Australian standards, but most immigrants are not rich enough to buy property outright. Mostly they increase competition in the rental market. Most of these people are settling in Sydney and Melbourne with an estimate of 70-80% of people moving to these two cities. http://www.abc.net.au/news/201... 6. The mining/resources boom. In the late 1990s/early 2000s the mining/resources boom brought a ton of wealth into Australia, this prevented a natural correction from occurring in the property market. More money flooded into the market which has helped to inflate prices and keep the cycle going. Now, with all of these factors combining there are many things occurring in the domestic market. Yes the car industry is closing, but overall that's not a big deal so far, because we haven't been exporting many cars for years and it's been a government funded jobs program. Wages are stagnant and growth is quite low at the moment, at the same time we have seen layoffs increasing especially in the mineral states such as Queensland, South Australia and Western Australia. The biggest threat to the economy in my opinion is high house prices growth at a time of high unemployment growth. We are seeing areas which most people would not consider desirable to purchase housing in (traditionally poverty stricken high crime areas)
Japan didn't have laws excluding any foreign company from owning more than 50 of a business, so I didn't care at the time. Neither did England.
China, however....
The problem with Chinese investment is it's an unfair one way street. "Oh, you want to own something here? Sorry! not allowed."