FOREIGN investors buy houses worth twice as much as local buyers a new report has revealed.

And while many think they are driving up prices for local buyers the report by Propell National Valuers said the affect wasn’t that significant.

It said foreign buyers targeted specific types of properties, mostly inner city apartments and expensive properties in Sydney and Melbourne, with Brisbane also starting to attract interest.

“In those specific markets, the impact on prices is likely to be measurable, but our analysis suggests that they have added around 5 per cent to values of prestige property, in preferred suburbs only,’’ it said.

“If price increases were mainly the result of foreign buyer interest, then we would have expected Melbourne prices to increase at a rate closer to that of Sydney.

“The fact that Sydney prices have increased at double the rate of Melbourne shows that most of the increase is due to the imbalance between supply and demand in Sydney.’’

The report said foreign buyers had doubled their presence in the market in the last year with 23,054 residential applications worth $34.7 billion lodged with the Foreign Investment Review Board.

In 2014 there were a total of 309,124 residential sales with only 7.5 per cent or about 23,000 to foreign buyers.

They spent an average of $900,000 per property although the overall median price was $480,000.

“Put another way, foreign buyers purchase property that is almost twice the price of the typical domestic buyer,’’ the report said.

It said while 23,054 residential applications were filed by foreign buyers, the actual number of purchases will be lower.

Victoria accounted for 43 per cent of the applications, New South Wales, 33 per cent, Queensland 13 per cent, Western Australia 7 per cent and South Australia 3 per cent.

Source：http://www.news.com.au/finance/real-estate/a-new-report-has-revealed-foreign-buyers-will-spend-twice-as-much-as-local-buyers-on-property-but-are-they-driving-up-prices/story-fncq3era-1227462042408