Australia’s cost of living crisis and the PRC

Cost-of-living pressures have intensified debate in Australia about housing affordability and the role of foreign investment in residential real estate, particularly from the People’s Republic of China (PRC). Public concern is significant. According to the UTS:ACRI/BIDA Poll 2025, 76 percent of Australians take the view that ‘Foreign buyers from China drive up Australian housing prices’, while 69 percent say that ‘Chinese investors have negatively affected the rental market for residential real estate in Australia’.[1] 

While public debate often centres on housing affordability, Australia’s trade relationship with the PRC also has measurable cost-of-living effects for households. Research from the Bankwest Curtin Economics Centre finds that in 2022-23, Australian households received a 4.2 percent cost-of-living benefit from lower-priced imports sourced from the PRC rather than more expensive alternative suppliers. Combined with the PRC’s demand for Australian exports, trade with the PRC increased average household disposable income by 4.6 percent or $2,600.[2] 

This fact sheet published by the Australia-China Relations Institute at the University of Technology Sydney examines the scale of PRC participation in Australia’s residential property market, the regulatory framework governing foreign investment and the available evidence on housing price impacts.[3]

1. Australia maintains a regulatory framework governing foreign investment in residential property. Foreigners wanting to invest in Australian residential real estate must first obtain approval from the Australian government’s Foreign Investment Review Board (FIRB). The current FIRB application fee for foreigners is $15,100/$45,300 for new/established dwellings worth $1 million or less. The fees for dwellings worth $2 million or less are $30,300/$90,900.[4]
   
   
2. With few exceptions, the FIRB only allows foreigners to invest in new housing. Australian government policy settings are based on the assessment that foreign investment in new housing increases domestic supply – improving affordability for the public, creating construction sector jobs and bolstering government revenues.[5]
   
   
3. Foreigners who are temporary residents, such as international students, can purchase an established dwelling but only for the purposes of living in while in Australia. The property must be sold when they are no longer residents. In 2019, there were 164,202 PRC nationals studying in Australia. This has since fallen to 143,481.[6]
   
   Since 2019, total net migration (temporary and permanent) from the PRC is 363,000. This compared with net migration from all countries of 6.7 million.[7]
   
   
4. Foreign owners of Australian residential real estate must pay an annual vacancy fee if properties they own are either not lived in by themselves (or a relative) or not made available as a residence on the rental market for at least six months of a given year. The vacancy fee is double the original foreign investment application fee.[8]
   
   While compliance issues related to annual vacancy declarations have attracted public commentary,[9] the total stock of foreign-owned residential properties represents less than 0.4 percent (40,177) of Australia’s housing supply (over 11 million),[10] limiting its significance.
   
   
5. In 2024-25, the total value of Australian residential real estate sales stood at $726.6 billion, comprising 722,000 transactions.[11]
   
   In the same year, the FIRB issued 1,355 approvals to PRC investors to purchase residential real estate, totalling $1.4 billion.[12]
   
   
6. Since 2016, the Australian Tax Office (ATO) has compiled a register of residential land acquisitions. In 2023-24 (the latest year for which data are publicly available), there were 2,007 acquisitions by PRC nationals. This compared with total acquisitions (all foreign and domestic) that year of 538,861.[13]
   
   
7. To test the sensitivity of Australian residential real estate prices to Chinese investment, a peer-reviewed article recently published in Housing Studies, a leading international journal for developments in the housing field, used controls on outbound capital imposed by the PRC government in 2017 as a natural experiment. Focusing on Sydney, the study found that only a limited number of suburbs with large concentrations of Chinese residents, such as Chatswood, showed statistically significant effects.[14]

Endnotes

 
[1] Elena Collinson and Paul Burke, UTS:ACRI/BIDA Poll 2025: The Australia-China Relationship: What do Australians Think?, Australia-China Relations Institute, University of Technology Sydney, November 18 2025 <https://www.uts.edu.au/news/2025/11/utsacribida-poll-2025>.
[2] Bankwest Curtin Economics Centre, Australia’s Trade and Economic Relationship with China, Australia China Business Council, June 2024 <https://acbc.com.au/wp-content/uploads/2024/06/Benefits-to-Australian-Households-Report-ACBC-Final.pdf>.
[3] This fact sheet updates James Laurenceson, ‘Australian housing availability and affordability: The impact of Chinese investment and migration’, Australia-China Relations Institute, University of Technology Sydney, August 21 2024 <https://www.uts.edu.au/news/2024/08/australian-housing-availability-and-affordability-impact-chinese-investment-and-migration>. 
[4] Australian Taxation Office, ‘Residential fees for a foreign person’, July 1 2025 <https://www.ato.gov.au/individuals-and-families/investments-and-assets/foreign-resident-investments/foreign-investment-in-australia/fees-for-foreign-residential-investors#ato-Howmuchisthefee>.
[5] Standing Committee on Economics, Report on Foreign Investment in Residential Real Estate, Parliament of Australia, November 27 2014 <https://www.aph.gov.au/Parliamentary_Business/Committees/House/Economics/Foreign_investment_in_real_estate/Tabled_Reports>.
[6] Australian Government Department of Education, ‘International student numbers by country, by state and territory’, accessed February 23 2026 <https://www.education.gov.au/international-education-data-and-research/international-student-numbers-country-state-and-territory>.
[7] Australian Bureau of Statistics, ‘Overseas migration’, December 19 2025 <https://www.abs.gov.au/statistics/people/population/overseas-migration/latest-release#net-overseas-migration>.
[8] Australian Taxation Office, ‘Vacancy fee return for foreign owners’, April 17 2025 <https://www.ato.gov.au/individuals-and-families/investments-and-assets/foreign-resident-investments/foreign-investment-in-australia/vacancy-fee-return-for-foreign-owners>.
[9] Jessica Wang, ‘Chalmers forced to act as foreign investors’ Aussie homes sit empty’, Daily Telegraph, February 1 2026 <https://www.dailytelegraph.com.au/news/nsw/one-in-five-foreign-investors-file-mandatory-disclosure-of-vacant-homes-as-hanson-slams-chalmers/news-story/3e5104c7effe4dcfb616f509917cea58>. 
[10] Australian Bureau of Statistics, ‘Total value of dwellings’, December 2 2025 <https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/total-value-dwellings/latest-release#data-downloads>.
[11] Marcella Choy, ‘Property insights | June quarter data shows Australian property recovery continues’, Pexa, July 22 2025 <https://www.pexa-group.com/content-hub/property-insights-and-reports/property-insights-fy25/>.
[12] Australian Government the Treasury, Quarterly Report on Foreign Investment – 1 April to 30 June 2025, February 2026 <https://foreigninvestment.gov.au/sites/foreigninvestment.gov.au/files/2026-02/quarterly-report-on-foreign-investment-apr-jun-2025.pdf>.
[13] Australian Taxation Office, ‘Residential land’, October 2 2025 <https://www.ato.gov.au/individuals-and-families/investments-and-assets/foreign-resident-investments/foreign-investment-in-australia/register-of-foreign-ownership-of-australian-assets/register-of-foreign-ownership-of-australian-assets-2023-24-report/residential-land#ato-Part1Registeredinterests1July2023to30June2024>.
[14] Song Shi and Xunpeng Shi, ‘The impact of Chinese regulation of limitation on currency transactions (LCT) on Sydney housing prices’, Housing Studies, June 2024, vol. 39, no. 11, pp. 2764-2786 <https://doi.org/10.1080/02673037.2023.2222675>.