This article is from the Australian Property Journal archive
FOREIGN investors have invested $59.1 billion in Australian real estate in 2011-12 — up $17.6 billion from last year, outstripping the mining sector for the first time in recent history, according to the Foreign Investment Review Board.
According to the FIRB Annual Review report, foreigners ploughed $170 billion in the local markets — a 3.4% decrease on the $176.7 billion in 2010-11.
FIRB chairman Brian Wilson said excluding real estate, mining accounted for around 46% of investments whilst manufacturing, represented $29.5 billion.
Wilson said the board had observed recent investment by sovereign wealth and superannuation funds from Europe and North America, demonstrating Australia’s continued competitiveness as an investment destination.
The real estate sector bucked the decline, offshore investors parked $59.1 billion in property sector compared with $41.5 billion in 2010-11. The increase is attributable the strong appetite for commercial real estate, which increased from $20.6 billion to $39.4 billion in 2011-12. Investment in residential real estate decreased slightly, from $20.9 billion to $19.7 billion in 2011-12.
The figure would have been higher, but the FIRB rejected 13 real estate deals compared with 43 last year.
Of the 10,703 applications approved, 5,803 were approved subject to conditions and 4,900 without conditions being imposed. All but one of the conditional approvals were in the real estate sector.
Wilson said the overwhelming majority of approvals in the categories below $50 million relate to real estate. The significant differences in recent years in these numbers were largely due to changes to the screening arrangements for temporary residents purchasing residential real estate in 2009 and 2010.
New South Wales was the favourite destination for overseas real estate investors, followed by Victoria and Queensland.
In other sectors, investment was $111.6 billion, a decrease of 17.5% compared with the $135.2 billion last year.
The United States was again the largest source of funds, accounting for 21% of the total value or $36.6 billion, followed by the United Kingdom ($20.3 billion), China ($16.2 billion), Japan ($13.9 billion) and Canada ($8.9 billion).
Property Review
