Though it is welcomed to see the Australian Treasurer committed to assuring that foreign property buyers play by the rules (local laws). The true problem at hand for Australia is the localised $1.9Trillion in household debt owed by locals. Not foreigners.
Could foreign buyers be making an impact on the price of housing across all of Australia? Mathematically that is impossible to be the case. But foreign buyers would indeed be making an impact in a small handful of suburbs across the major cities. And that is a common global phenomenon whether we are talking about Sydney, Las Vegas, Miami or Berlin. And thus should be accepted. Remember, Australia has no New York’s, London’s or Hong Kong’s. And as a frequent traveler able to look at the Aussie housing market from the outside in, believe me when I say the Australian housing bubble is a localised issue, not a foreign buyer issue.
Australia’s inevitable problem is that the nations wealth model is created through Ponzi financing. Allowing property buyers to leverage on new found equity whilst not earning any income from the investments they make is the most dangerous of wealth creation models. This well known property investor in this youtube video illustrates precisely how our banking system lends in a way that can only be described as Ponzi financing.
History tells us, this type of wealth creation model has a 0% success rate as an end result.