“From the Gold Rush to the Property Rush: Rich Chinese” – Musings from an Australian Perspective

Rich Chinese. Have any two words gone together more smoothly before in the Australian accent? The two seem inseparable while the alternative – Poor Chinese; spoiler alert for the next extract – is an oxymoron. This transcript from a conversation at an Aussie BBQ is about as authentic as it gets:

“Hey, Dazza mate, who bought the big house down the road?”

“Yeah, nah mate, dunno. Probably Chinese.”

Recently in an outer suburb of Sydney I saw an old manor house for sale, and out of curiosity I researched it online to see the price. It was about $3.5 million AUD, but that wasn’t actually the surprising thing (sadly, it was expected). The opening line of this property advert had something akin to: “Situated at lucky number 88 ____ road…” Because the pronunciation of ‘eight’ sounds similar to ‘prosperity’, in Chinese culture it is considered extremely fortunate to have ‘eights’ in your life, even in your mobile number. 88 in particular carries a meaning of ‘double joy’. This realestate agent knew exactly who to target this unaffordable house too. Of course, the same can work in reverse. If you’re holding onto a fancy apartment, maybe looking to sell, but it’s apartment number 4 at 514 Dead Street, it might be harder to get a higher price from the Chinese interest. Just like how floor 13 is often not listed on high rise buildings in the West, floor number 4 is skipped in China because the pronunciation of ‘four’ sounds like ‘death’ if you mess the intonation up.  I have always remembered that the 2008 Beijing Olympics opened on the 8th of August (because it was a few days after my birthday and I happened to be on a music camp in the middle of nowhere, freezing, and fifty of us had to watch the Ceremony on one tiny 60cm TV with fuzzy reception) but I hadn’t realised until now that that was a chosen date for the 08/08/2008 and apparently started at 08:08:08pm local time. Interesting, bizarre and crazy things have been done in the name of Chinese numerology, but lots of them seem to happen with an exceedingly high payment for a certain figure combination.

To Barry Li’s book: He makes the necessary disclaimer that there are rich and poor Chinese in every province so it’s impossible to assess someone’s wealth from their hometown alone. However, he later adds that demographically the rich Chinese are mostly on the east coast, meaning major cities like Beijing, Shanghai, Shenzhen, Tianjin, Suzhou and a stack of plenty others. The inland and western area has been mostly undeveloped until the past decade – although the “One Belt One Road” project is another strategy to remedy that –  so this causes an incessant flood of migration from the west to the east, pushing up the population in cities that nearly match Australia’s total population, and tripling house prices in the last decade alone. Property are more often fiscally valued by their square metre size, rather than any aesthetic appeal and Li claims that a small three-bedroom apartment in Beijing would cost over $1million AUD. Friends in Beijing inform me that this price would be actually over $3million AUD, with the rough calculation of one bedroom = $1million USD, two bedroom = $2million USD… Regardless, no wonder a Sydney Surry Hills terrace house, 3 bedroom 2 bathroom, going for maybe under $2million AUD looks appealing, irrespective of foreign ownership tax laws.

Li gives a few (frightening? shocking? unbelievable? believable?) examples of the rich Chinese hanging around in Sydney today, both international students and both from the entrepreneurial city of Wenzhou. The first student asks him for start-up business advice which he gives, including information on the Lean Startup method. She then surprises him by informing that she’s planning on investing $100,000 – $150,000 (most of which is her parents’ money). The second student asks Li whether to stay in Australia or return to China following graduation, saying that her family was not all that rich. Li

“suggested that as her ‘not very rich’ family doubtless were worth more than 100 million yuan, she should probably go back home rather than stay in Australia. She said they had only 80 million in assets (about $16 million) which was not quite enough for the whole family.”

Some numbers from a later chapter jumped out at me when I was casually flicking through the other day, and I think they’re important to share here. In 2013 China’s GPD per capita was $6800 USD – one-tenth of Australia’s $67,458 (GDP, finance, sharemarket stuff flies over my head, but stay with me here). But that’s an average distribution of wealth, with China really does not have. Li says that “1 percent of Chinese families own about one-third of the country’s total wealth, while 25 percent of families at the bottom of society hold only 1 per cent of the total social wealth.” When this is put in perspective with China’s population of 1.38 billion, if 1 percent of those are super super rich, that still means there’s 13.8 million super super rich Chinese… and this is half of Australia’s population. Imagine Adelaide ten times over just filled with multibillionaires (what a stimulus package).

If you meet a “new Chinese” here in Australia, who owns property in China, the crux is that they are likely what Barry Li terms a “rich Chinese”. How they act with this wealth is of course completely dependant on their personal selves – just like anywhere in the world – and not beholden to the fact that their ancestry is Chinese. But if it does feel like Chinese migrants own every fancy apartment in every major city (and mainstream media certainly makes us want to think that way) then it pays to remember the numbers. Yes, there are lots of rich Chinese but their numbers seem larger in places of smaller population, although the effects of them in society are more obvious, both positive and negative.

 

Photo taken in Surry Hills, Sydney, July 2017. Not a photographer – just going through the photos I have and finding a new purpose for them. 

2 thoughts on ““From the Gold Rush to the Property Rush: Rich Chinese” – Musings from an Australian Perspective

  1. Pingback: “From the Gold Rush to the Property Rush: Poor Chinese” – Musings from an Australian Perspective – The New Chinese

  2. Pingback: “Why Should an Australian Read This Book?” – Musings from an Australian Perspective – The New Chinese

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