Canada’s government recently made an abrupt decision that could have repercussions for Australia’s already overvalued residential property market.
Canadian Finance Minister Jim Flaherty on February 11 announced that a 28-year-old visa scheme designed to attract wealthy foreigners to the country would be axed, effective immediately.
Under the now defunct Immigrant Investor Program, as long as you had a cool $C1.6 million ($1.6 million) in net assets, then all you needed to do was lend the Canadian government $C800,000 for five years on an interest-free basis and you were assured permanent residency for you and your family and a fast-track to citizenship.
The decision raised some eyebrows, not least because preceding the decision there had been growing chatter that the country’s already expensive housing market was being inflated even further by a wave of wealthy Chinese entrants into the country, and in Vancouver in particular.
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At the time the immigration scheme was axed, there was a backlog of 65,000 applicants, of which 45,500 were mainland Chinese – and 80 per cent of those were bound for the province of British Columbia, according to analysis by the South China Morning Post.
Indeed, The Economist rates Canada’s residential property market as one of the world’s most expensive. The magazine’s analysts say housing is 76 per cent overvalued against long-term averages on a rental basis – the highest among the 23-country league table – and 31 per cent against disposable incomes.
The ratio of Canadian household debt to GDP has risen to almost 100 per cent, and has grown at the fastest rate in the world since 2006, according to the World Bank. In April 2012, the former governor of the Bank of Canada, Mark Carney – now the head of the Bank of England – warned of the risks of foreign capital inflating the housing market.
More buyers to look in Australia
Canada may seem like a long way away but any move by Canadian authorities to reduce the risk of a potential bubble and subsequent burst should be welcomed by Australian investors, says Tyndall Asset Management’s head of fixed income, Roger Bridges.
The country’s housing market is one on a list of “low probability, high impact” events the bond strategist is keeping an eye on.
That’s because while our local lenders have little direct exposure to Canadian banks, the similarity between our two economies could cause a fresh wave of risk aversion among global investors, many of whom already believe our property market is a bubble ready to pop.
Of course, rich foreigners can only push up prices at the margin, and usually only in specific areas; low interest rates have helped fuel Canadian demand for mortgages, against the background of an economy that avoided a GFC-inspired recession thanks to its heavy emphasis on commodity exports.
All this might be sounding familiar to Australians, particularly those who have been house hunting in Sydney, where anecdotal evidence suggests auctions in some areas have been heavily attended by wealthy Chinese buyers willing to pay lofty premiums.
And the decision by Canada to restrict access to such rich individuals can only boost interest in our market.
Research by HSBC Bank suggests more than one-third of affluent Asians own overseas property, and that our market is the number one destination for further investment. Of the wealthy mainland Chinese surveyed by HSBC, 9 per cent owned property in Australia, while of the respondents from Hong Kong, 10 per cent did.
Of the rich Indians surveyed 18 per cent owned Australian property, 19 per cent of Indonesians and Singaporeans, 26 per cent of Malaysians, and 5 per cent of wealthy Taiwanese.
But while home buyers may complain, it’s great news for local property developers, such as the listed Australand.
It revealed in its annual results on February 17 that it sold about 15 per cent of its residential developments to offshore investors in 2013, primarily mainland Chinese, almost double the historical average of 8 per cent.
The sales were made through its Hong Kong office, which Australand opened some 10 years ago. The company said it expected demand from that segment to remain at the same level in 2014.
But on the evidence of growing overseas interest in grabbing a slice of the Australian dream, that may be a conservative view.
加拿大财政部长费海提取消了为吸引具有购买力的外国买家的政策，可能会对澳大利亚已经被高估的住宅物业市场带来不利影响。
加拿大财政部长费海提在本月11号宣布即时生效的新政：取消已存在28年的旨在吸引富有的外国人的签证政策。
原有政策规定，拥有净资产达160万美元的外国人，无息贷款给加拿大政府达五年，借款人及其家人即可获得永久居留权并可提前获得加拿大国籍。
有一些人并不支持原有的政策，很大一部分原因是越来越多人认为加拿大国内原本已高企的楼价被富裕的中国人进一步推高了，在温哥华尤为明显。
据《南华早报》的分析，在政策被取消时，有六万五千名申请者的申请被积压，其中有四万五千五百名为中国大陆人，他们之中百分之八十准备前往位于加拿大西部的不列颠哥伦比亚省
《经济学人》杂志将加拿大的住宅物业市场评为全球最贵之一。该杂志的分析员认为在租赁方面，住房和长期以来的平均数值相比被高估了百分之七十六，是参评的二十三个国家中最高的，超出可支配收入百分之三十一。
根据世界银行的数据，加拿大的家庭债务与国内生产总值的比值接近一比一，是2006年以来增长最快的国家。2012年4月，前加拿大银行主席、现任英格兰银行行长马克·卡尔尼，警告外国资本具有使房地产市场膨胀的风险。
更多的买家考察澳大利亚
廷德尔资产管理公司固定资产部门的负责人罗杰·布瑞吉斯表示，加拿大可能提早许多作出调整，但加拿大当局做出的减少泡沫出现的风险的举措应该受到澳大利亚投资者的欢迎。
加拿大的房地产市场属于安全性高，影响力大的类型，正被债务研究人士密切注意。
上述现象的原因是，澳大利亚的本土放贷者与加拿大方面的银行只有很少的联系。两国经济的相似程度会使很大数量的全球投资者选择规避风险，他们之中的很多人已经认为澳大利亚的房地产市场的泡沫将要破裂。
当然，富有的外国人只能在边缘上推高价格，并且通常只在特定的领域。低利息率使加拿大，在严重依赖商品出口的经济背景之下对贷款的需求增大。
所有上述的情况对于澳大利亚来说都很熟悉，特别是那些曾在悉尼购房的人。一些证据显示，悉尼的某些地方的拍卖会已经有愿意出高昂额外费用的中国买家出席。
而加拿大限制那些富有的人进入该国后，只会使澳大利亚市场利率升高。
汇丰银行的调查显示超过三分之一的富有的亚洲人拥有海外资产，澳大利亚是他们进行海外投资的首选目的地。参加调查的来自中国大陆的人中有百分之九的人在澳大利亚拥有房产，来自香港的被调查者中有百分之10拥有澳大利亚房产。
其他地区参与调查的同样拥有澳大利亚房产的情况是，百分之十八的印度人、百分之十九的印度尼西亚人和新加坡人、百分之二十六的马来西亚人和百分之五的台湾人。
尽管想要购买房产的人对这种情况不满，对于澳大利亚国内的地产商确是有好处的，例如澳洲置地。
该公司在本月17号发布的年报显示，在2013年有百分之十五的住宅卖给了海外投资者，主要来自中国大陆，几乎是历史记录百分之八的翻倍。
交易在该公司十年前开始设立在香港的办事处进行。该公司表示他们预期2014年在该类型的房产的需求上会同2013年持平。
但从不断增长的海外投资对于澳大利亚前景十分看好这方面来看，这似乎是保守看法。
