SYDNEY, May 9 (Reuters) - Australia approved foreign investments worth almost a third more in fiscal 2016 than the previous year, as more Chinese buyers piled into the already red-hot residential property market, government data published on Tuesday showed.
The figures in the Foreign Investment Review Board’s 2016 annual report highlight the huge Chinese appetite for Australian property even as economists expect the housing market to ease in 2017 amid rising lending rates.
“For the third year in a row, China was the largest source of approved investment, driven by continuing approvals in the real estate sector,” the report said, adding that the United States was the second biggest source of approved investment.
The total value of foreign investment approvals in Australia reached A$247.9 billion ($182 billion) in the year to June 30, 2016, up 29 percent on the previous year and nearly double the A$135.7 billion total of the prior three years.
A total of A$47.3 billion Chinese investments were approved that year, a fifth of the overall total foreign investment. Of those approved Chinese investments, $31.9 billion was into real estate.
The report didn’t say what proportion of foreign investment in new dwellings came from China. Approvals for all foreign investment in new homes totalled A$57.6 billion, up a third on the prior year.
The report said the rise in foreign investment approvals for new homes “is in line with the policy to encourage residential real estate investment that increases housing supply”, a reference to new rules making it harder for foreigners to buy existing Australian homes.
$1 = 1.3620 Australian dollars Reporting by Byron Kaye; Editing by Miral Fahmy