By Alan Weiss — Weiss Real Estate
In the Sydney Eastern Suburbs market, one sales line continues to resurface even though the evidence no longer supports it: “I have Chinese buyers in my database who will pay a premium.” Trevor recently heard this claim from a Double Bay agent who presented it as though he had exclusive access to a special pool of buyers capable of paying above-market prices. The implication was clear: this agent could deliver results others couldn’t because his connections stretched into unique financial networks.
It is an attention-grabbing statement, but it doesn’t align with what is actually occurring in the prestige market today. While the idea of Chinese buyers paying premiums once held weight during earlier market cycles—most notably between 2014 and 2017—the conditions that created that environment have shifted significantly. The market in 2025 is shaped by very different forces.
The strongest sales throughout Double Bay, Rose Bay, Bellevue Hill, Bondi Beach, Coogee and surrounding suburbs are now overwhelmingly being made to local buyers. These include local downsizers, established families, long-term professionals and Australian residents of Chinese heritage who already live and work in Sydney. These buyers behave like the rest of the market: they’re subject to Australian lending rules, local market sentiment and the same financial considerations as every other purchaser. They are not offshore investors paying above-market premiums.
This shift in buyer demographics is mirrored by the situation in China itself. China’s property market is under sustained pressure, with major developers restructuring debts, incomplete housing projects across multiple regions, subdued buyer confidence and tighter regulations on speculative activity. These conditions have made Chinese households more risk-averse. Internationally, high-net-worth Chinese investors face strict capital controls, including the long-standing USD $50,000 annual overseas transfer limit per person. Larger transfers attract scrutiny from both Chinese and Australian authorities, making offshore purchases slow, complex and often impractical.
Australia has also become one of the most expensive countries in the world for foreign nationals to buy property. In New South Wales, foreign buyers face an 8 percent stamp duty surcharge, a 4 percent annual land tax surcharge, standard stamp duty, FIRB approval fees that can exceed $100,000 on higher-value purchases, and ongoing compliance obligations. For a $5 million purchase, a non-resident may face close to $1 million in additional taxes and charges before legal costs or holding costs are counted. No rational investor purchases at a premium under these conditions.
Even if a foreign buyer absorbs these costs, the return on investment is generally poor. Net rental yields on prestige apartments average between 1.8 and 2.2 percent. Capital growth forecasts are conservative due to significant upcoming apartment supply across Bondi Junction, Randwick, Mascot, Zetland, Waterloo, Alexandria and other key eastern and inner-city precincts. Currency risk further erodes potential returns. When compared with the performance of index funds, ETFs or even conservative offshore investment products, Sydney property is no longer the clear choice for international investors seeking yield or compounding growth.
Given these factors, the idea that offshore Chinese buyers are entering the market and paying premiums is not supported by current conditions. The buyers of 2025 who have Chinese heritage are overwhelmingly Australian citizens or permanent residents already living in Sydney. They are part of the domestic market, not a separate category of foreign capital. Treating them as offshore premium-paying investors misrepresents the true dynamics of today’s prestige sector.
For sellers, the key is to understand that the market premiums achieved in 2025 come from local competition, strong presentation, data-driven pricing strategies and the quality of the negotiation process—not from offshore investors paying above-market prices. Claims of exclusive access to foreign premium buyers should be examined carefully. Genuine foreign purchases in the prestige market today are rare, and the structural factors that once led to aggressive offshore buying are no longer present.
The reality is straightforward: today’s prestige market is powered by domestic buyers, local wealth and lifestyle-driven decision-making. The “Chinese premium buyer” narrative belongs to a previous market cycle. Successful sellers in this environment are those who rely on clear data, strong preparation and agents who understand today’s conditions rather than selling yesterday’s story.
