Foreign Investment Impact On Australian Residential Real Estate Market

Question: Discuss about the Foreign Investment Impact On Australian Residential Real Estate Market And Housing Affordability. Answer: Introduction: The growth of foreign residents in Australia has start participating in the purchasing of the residential houses. The purpose of this article is to analyse the impact of foreign investment on making affordability in the housing market. The supply of residential area is increasing with the demand of it from foreign investors. The price rate of the dwelling area is getting increased due to the increase of demand. The legislative laws are developed in Australia to promote local construction for the development of dwelling houses (KPMG Economics, 2017). The residential projects are purchased by foreign investors or domestic buyers. It influences the housing living condition in the Australia. The people of Australia are looking forward for investment in the residential area. The Gross domestic product rate of the Australia country is increased to a high extent due to the foreign investment from various sources in housing residential area. Background The increasing demand of the dwelling houses has resulted into the rise of price which is around 7.25 % every year. The analysis of the residential prices in the last ten years, it is found that the steady growth of 3% is increased. The price of the dwelling houses is increased near about 6 times from his actual price. The GDP of the country is increased due to the foreign investment in the residential area in Australia. The growth of economy helps in increasing the living condition of the people. The performance of the Australian investor is improving with the association and consideration of immigrant in the Australian policy of real estates (Masron and Kepili, 2016). The new opportunities are created for the property dealers and buyers. The foreign residents are also participating in the process of purchasing the houses (Sharpnel, 2016). The recent studies help in providing the information that 10 to 20% of the purchase of dwelling houses is done by the foreign investors. The popu lation explosion also increases the demand of dwelling houses for the local people and immigrants. Problem statement The major problem which exists with the housing investment is the increasing prices of the dwelling areas due to the increasing demand from foreign residents. The financial condition and stability of the residential people get disturbed with the investment in housing area. Aims and Objectives The aim of the research program is to analyse the impact of foreign investment in real estate market. The research helps in focusing the factors which are responsible for the increasing demand of residential houses. Research Questions The research questions which are designed for undertaking the research on impact of foreign investment are given below: What is the impact of foreign investment on the growth of real estates? Why the foreign investors are interested in investing the purchase of dwelling houses? Why there is a significant increase in the price of the dwelling houses? What is the relationship between foreign investment and the growth of GDP of Australia? Literature Review: The foreign investors invest their money in the purchase of the dwelling houses with the purpose of long term investment (Rogers and Koh, 2017). It has been seen that the price of the dwelling houses get increased with a very rapid rate. The volatile condition of the global market can result in the variation of prices of the residential area (Rahman, 2008). There are various factors which are responsible for the growth of foreign investment in real estate (Rohde, 2017). Resolution to the traditional problems: The investment in the real estate property opens the door for the new opportunity provided to the local constructor of the country. The new jobs are created for the local resident people which results into the increase of economic growth of the country. The Foreign investors are looking forward to invest in the real estate property of the Australian government. The GDP of the country get increased which results into the increase in livelihood income of the local people (Rogers, Wong, and Nelson, 2017). The growth of economy helps in increasing the living condition of the people. The performance of the Australian investor is improving with the association and consideration of immigrant in the Australian policy of real estates. The positive impact on the growth of the country can be seen with the involvement of foreign investment in the real estate sector. The decreasing rates of interest have motivated the foreign investor to invest in the Australian property. The recent studies help in providing the information that 10 to 20% of the purchase of dwelling houses is done by the foreign investors. Most of the people get located in the Australia from various locations such as New South Wales, and other (Standing committee on economics, 2014). Factors responsible for the growth of Residential area: The immigrant from various nation start participating the process of purchasing property to become the resident of Australia. The interest rate on housing is less so they can affordable invests their amount in the buying of the dwelling houses. The increasing demand of the houses has compelled the Australian government to provide authority to develop residential area. The local contractors are promoted for developing the residential building. The skilled workers and quality material are supplied to the contractor to develop a well-finished building to attract foreign investor to invest their money in purchasing the properties. The economy of the nation is increasing at a very high speed due to the association of foreign investor in the market of real estate. The performance of the Australian investor is improving with the association and consideration of immigrant in the Australian policy of real estates. The population explosion increases due to the increasing number of immigrants f rom different countries. The rate of foreign investment increases due to the demand placed by immigrants to get a dwelling house in the residential area of Australia. Problem Statement: Some economist shows interest to know the reason for high prices of the houses in the Australia. The increasing prices of the houses are due to the high demand of dwelling houses from the foreign investor and domestic purchaser. The major problem which exists with the housing investment is the increasing prices of the dwelling areas due to the increasing demand from foreign residents. The financial condition and stability of the residential people get disturbed with the investment in housing area. The people are looking forward to invest in the residential houses because it brings long term sustainability in their investment. Summary The study of the literature review helps in evaluating that the positive impact can be seen on the growth of the local people living standard due to the increasing growth of foreign investor in the real estate because it opens new door of employment in the country. The skilled workers and quality material are supplied to the contractor to develop a well-finished building to attract foreign investor to invest their money in purchasing the properties. The volatile condition of the global market can result in the variation of prices of the residential area. There are various factors which are responsible for the growth of foreign investment in real estate. The decreasing rates of interest have motivated the foreign investor to invest in the Australian property. The recent studies help in providing the information that 10 to 20% of the purchase of dwelling houses is done by the foreign investors. Research Methodology The qualitative research methodology is used for figure out the impact of foreign investment in the residential houses. The growth in the income of the local people had motivated them to invest into housing property. Research Methodology The research is designed by collecting data from various sources. The collected data is used for developing the sample design. Research Philosophy: Various researchers integrate their views for increasing demand of foreign investment. The positivism philosophy is used for resolving the complexity of the real world for managing investment with respect to the legal and political issues associated with the property (Gauder, 2014). The association of new thought and opinion for achieving the long term sustainability program motivate them to do investment in property. It is realistic approach for investment. The impact of legislation complexity and implication of it in solving the issues related to the property helps in increasing the property value. Research Methods and data sources Different research methods are used for the analysis of the research agenda which focuses on the impact of foreign investment on the real estate agency. The hypothetical testing of the data collected helps in analysing the profitability ratio of the Australian government. The analysis of the report helps in examining the validity of the project. Qualitative approach: The qualitative approach is used for collecting the qualitative data which is used for measuring the application of the theoretical data in the practical life. The result of the study helps in evaluating the facts of improvement which have been seen in the growth of the local people due to the inclusion of foreign investment (Georgieva, 2017). The livelihood incomes of the local people have been improved to a high extent. It helps in bringing stability in the living condition of the people. Theoretical Approach: The hypothetical testing of the data collected helps in analysing the profitability ratio of the Australian government. The analysis of the report helps in examining the validity of the project. Data collection method The primary data and secondary data required for completing the research study can be collected through survey, interviews, questionnaires, journals, articles, and magazines. The Survey on the site location helps in analysing positive and the negative impact on the local people due to the construction of the houses and residential building. The organization of the face to face interview helps in predicting the problem faced by the local people in the transformation of their houses due to the construction of new residential building for the foreign investor. The people are looking forward to invest in the residential houses because it brings long term sustainability in their investment (Wokker and Sweiringa, 2017). The economic conditions of the local people get increased with the implementation of foreign policies for construction. Summary The analysis of the theoretical data helps in evaluating the impact of foreign investment on the life and living standard of the local people. The growth of economy helps in increasing the living condition of the people. The performance of the Australian investor is improving with the association and consideration of immigrant in the Australian policy of real estates. Different techniques of data collection help evaluating the financial crisis or profit faced by the Australian government with the association of foreign investor in the purchasing market of the real estates. The reserve bank of Australia has provided very low rate of interest which the people has to give on account of re-payment to the bank (Feriedouni, and Tajaddini, 2016). The low rates of interest help in attracting new foreign investors towards the nation to purchase a property in the country. Conclusion The positive impact on the growth of the country can be seen with the involvement of foreign investment in the real estate sector. The GDP of the country get increased which results into the increase in livelihood income of the local people. The volatile condition of the global market can result in the variation of prices of the residential area. The new jobs are created for the local resident people which results into the increase of economic growth of the country. The price of the dwelling houses is increased near about 6 times from his actual price. The GDP of the country is increased due to the foreign investment in the residential area in Australia. References: Feriedouni, H., and Tajaddini, R. (2016). Foreign investment in residential real estate in Australia, housing prices and performance of real estate related sectors. 1st ed. [ebook]. Available at: https://businesslaw.curtin.edu.au/wp-content/uploads/sites/5/2016/07/panel-data-conference-foreign-investment-in-residential-real-estate-in-australia-housing-prices-and-performance-of-real-estate-related-sectors.pdf [Accessed 06 Apr. 2018]. Gauder, M. (2014). Foreign investment in residential real estate. 1st ed. [ebook]. 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