The Contribution of Foreign Real Estate Investment to Housing Price Growth in Australian Capital Cities

15 Pages Posted: 20 Sep 2017

See all articles by Ross S. Guest

Ross S. Guest

Griffith University - School of Accounting and Finance - Gold Coast Campus

Nicholas Rohde

Griffith University

Date Written: September 2017

Abstract

This paper models the effects of foreign investment in real estate on housing prices in Australia. We use a variety of panel data models that account for cross‐sectional heterogeneity across Australian cities and find that increases in investment are significant predictors of rises in the Australian Bureau of Statistics’ Residential Property Price Index. Our results are generally robust and suggest that increases in foreign investment account for between 20% and 30% of the rise in housing prices between 2004 and 2014 in Sydney and Melbourne. In other capital cities the effects appear to be negligible. Some policy implications of our findings are discussed.

Keywords: Foreign investment, Housing prices, Real estate

Suggested Citation

Guest, Ross and Rohde, Nicholas, The Contribution of Foreign Real Estate Investment to Housing Price Growth in Australian Capital Cities (September 2017). Abacus, Vol. 53, Issue 3, pp. 304-318, 2017. Available at SSRN: https://ssrn.com/abstract=3039755 or http://dx.doi.org/10.1111/abac.12110

Ross Guest (Contact Author)

Griffith University - School of Accounting and Finance - Gold Coast Campus ( email )

PMB 50 Gold Coast Mail Centre
9726 Queensland
Australia

Nicholas Rohde

Griffith University

170 Kessels Road
Nathan, QLD 4111
Australia

Register to save articles to
your library

Register

Paper statistics

Downloads
0
Abstract Views
92
PlumX Metrics