Property editor of the NZ Herald

Property insider: It's bigger than you think

The whistleblower said "people living in China buy the places Kiwis are trying to get".
The whistleblower said "people living in China buy the places Kiwis are trying to get".

Mainland Chinese money snapped up at least 80 per cent of residential sales in parts of Auckland in March but were nearer 90 per cent in May, a whistle blower from the industry says.

The Herald reported at the weekend Labour data that showed people of Chinese descent accounted for 39.5 per cent of the almost 4000 Auckland transactions between February and April.

Yet Census 2013 data showed ethnic Chinese who are New Zealand residents or citizens account for only 9 per cent of Auckland's population.

The property insider - who wanted to protect their identity because they feared for their job - said the situation was much more serious than the Labour data suggested.

The numbers should be more than doubled due to the weight of capital coming out of Mainland China, the whistle blower said.

READ MORE: Foreigners should build, not buy - economist

One big Auckland real estate agency, where many salespeople are of Chinese ethnicity, was selling almost every single property throughout many suburban areas to people living in China, the insider said.

In some cases, those buyers had a New Zealand connection "but it's one group disenfranchising the other. It's really taken off in the last 18 months. I've been studying the figures since October."

"The Kiwis, South Africans and British have dropped out of the market because they just can't compete with the Chinese. The people living in China buy the places the Kiwis are trying to get, then those places are rented out the next day," the insider said.

That showed the person is in an important position in the property sector with extensive access to information unavailable to the public revealing who the buyers really are.

"We're becoming tenants in our own country. It's utterly outrageous. The Chinese are interested in Panmure, Ellerslie, Greenlane, Epsom, Remuera, the North Shore - not so much the west."

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In some cases, a single Chinese resident was spending up to $15 million on Auckland properties and the higher the bidding at auctions went, the happier they were.

"They simply don't care how much they pay. It's not related to the CV. If they pay another $400,000 more, that's $400,000 they're better off as it's $400,000 they have shifted out of Mainland China. If they continue vacuuming up all the existing properties at the current rate of consumption, what will that do? The Chinese will outbid everyone at the auction. I'm sick of the phone bidder from Guangzhou. I'm relieved that someone at last is talking about this," the insider said of Twyford's data.

Peter Thompson, Barfoot & Thompson chief, acknowledged there were many Chinese buyers in Auckland but has disagreed with Labour's analysis.

"We know there's been a large portion of Asians buying property but there's no way to tell if they're one of three categories: NZ born, foreign-born NZ citizens or foreign-born foreign citizens. If you asked me about Asian non-residents, I'd probably say between 5 and 8 per cent," Thompson said.

It comes amid warnings that rich Chinese investors will be looking to take their money out of China's turbulent stock market and invest it in property overseas.

The Guardian reported that estate agents in Australia, Britain and Canada are expecting a surge of interest from Chinese buyers.

- NZ Herald

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