Mortgage broker predicts continued foreign interest in Aussie real estate

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The mortgage broking firm behind Australia’s first Chinese language mortgage comparison website is banking on continued interest in Australian real estate from foreign investors, as it prepares to list on the Australian Stock Exchange (ASX).

According to a report in the Australian Financial Review yesterday, N1 Finance & Lease is looking to list on the ASX by March this year and plans to issue up to 25 million shares to raise $5 million to fund future growth.

In March 2015 N1 Finance & Lease launched chengdai.com, which offers comparisons of Australian mortgages in Mandarin.

N1 Finance & Lease chief executive Ren Wong told the AFR that while some Australian markets are showing signs of cooling off, there are still solid fundamentals behind real estate in the country.

“N1 Finance is well placed to take advantage of a growing industry," Wong told the AFR.

“We know the housing market is a cycle. The slowing growth is not new but key drivers are still positive – a strong employment rate and a growing population,” he said.

“There are a lot of opportunities for us in the refinance and off-the-plan mortgage markets, especially among Asian buyers both local and foreign.”

Aura Capital’s Eric Chan, who is advising N1 Finance & Lease through the listing process, told the AFR that current economic conditions are favourable for foreign investors from across Asia who are looking to buy in Australia.

“There are still plenty of middle class Chinese and south-east Asian investors wanting to get exposure to the Australian property market. The low interest rate and attractive foreign exchange helps too,” Chan told the AFR.  

“And N1's target market is not only overseas Chinese investors but other foreign and local Asian investors too.”

Wong and N1 Finance & Lease aren’t the only ones who believe 2016 will continue to see Asian money flow to Australian real estate

Simon Henry, co-CEO of Juwai.com, which markets Australian real estate to Chinese buyers, believes that Chinese interest in Australian real estate, especially among those looking for premium properties, will grow in the coming year.

“Our forecast is for continued growth in the premium Chinese buyer market. New data from China shows that the country now has more billionaires than any other, even the United States. Its ranks of multi-millionaires is also growing rapidly,” Henry said.

“China is also considering the complete removal of all limits on capital exports by 2020. The Bank of England expects that to result in a 600% increase in Chinese ownership of overseas assets, including real estate."
 

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