Chinese investors are finding it difficult to pay off their Australian property investments after the big banks scaled back lending to foreigners as part of a crackdown on fraudulent loan applications.
National Australia Bank, Commonwealth Bank, ANZ and Westpac – the top 4 lenders of Australia – tightened lending rules for foreign investors about six months ago. In April, Westpac stopped lending to borrowers who lived outside Australia while the other banks announced they would apply stricter lending criteria for foreign customers.
According to Mr Wang, a Beijing-based expert, about 50,000 Chinese investors are now worried about how they will finance their Australian home loans. He said, “Say about 30 per cent of them are able to pay it all upfront, that leaves about 30,000 investors here who are affected — that’s quite a large number”.
Mr Wang said many investors are trying to get loans from other Asian banks, especially in Singapore. But many of them won’t be approved in time, he said.