The doomsday scenarios are forecast by the Washington-based International Strategic Studies Association. You could read the detail in their article titled “Australia Risks Strategic Setback from a Significant Foreign Direct Investment Drop Due to Changes in Bank Policies”. Catchy title guys!
If you get past the title, as news.com.au did, you will learn Australian bank policy changes could deter foreign direct investment in Aussie property, reducing government revenue and affecting everything from the property market itself to the Royal Australian Navy’s ability to proceed with its $50 billion submarine program. And this demise could begin by the end of October.
It comes after Australia’s richest man, billionaire property developer Harry Triguboff, warned that a “very significant” number of Chinese buyers were now failing to settle their off-the-plan units and urgent action was needed.
But Mr Triguboff, founder of Australia’s biggest apartment builder Meriton, warned the real risk was looming in the new wave of developments. As apartment price growth stalls or goes backwards, the risk of buyers walking away from their deposits grows.
The only problem with the report? It’s “garbage” NAB chief economist Alan Oster told news.com.au.
“What the banks were trying to do with the tightening of apartment lending, particularly to foreigners, was make sure that if people were having trouble offshore they didn’t end up in the Australian banking system,” he explained. So the risk might be somewhere, but not in Australia.
Breathe easy until the next conspiracy theory.
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