“Pro-Beijing groups linked to the Chinese consulate in Sydney were mobilised to support embattled Ryde deputy mayor Simon Zhou, who has been condemned for playing the “race card” after being referred to the NSW corruption watchdog.
Mr Zhou used a council meeting on Tuesday night to call on Chinese-Australians to “fight back and stand up” amid cheers from the public gallery packed with his placard-wielding supporters.
*The Australian Financial Review has discovered these supporters were not a local community group as their signs suggested, but mostly from the Hubei Homeland Association, which has links through its convener to the Chinese consulate in Sydney.
The group was organised via Chinese messaging service WeChat, with those involved told they needed to let “bad people” in the media and on Ryde City Council know that they did not agree with the recent attacks on their “Chinese representative”.
The group was organised by a person using the WeChat handle Wolf Grandma, an apparent reference to the patriotic Chinese movie Wolf Warrior.
On an adjoining WeChat group one person noted this was not a grass roots organisation and warned others that the organiser was “working for and connected” to Chinese authorities.
The person said the organiser’s husband was a former member of the People’s Liberation Army and remained in contact with those at China’s consulates and embassy in Australia.
The group was told to meet at Eastwood railway station at 6.10pm on Tuesday and take the 515 bus together to the council chambers.
Professor Feng Chongyi from UTS said the “race card” was too often played by Chinese people. Steven Siewert
Feng Chongyi, an associate professor of Chinese studies at UTS, said the show of support for Mr Zhou had the Communist Party’s fingerprints all over it.
“Whenever these issues emerge they rally to put on a show,” he said.
“But you can easily see that the Chinese consulate and so-called patriotic leaders are behind it.”
Simon Zhou, left, with disgraced Chinese billionaire Huang Xiangmo.
Sydney deputy mayor went to Communist Party training camp Professor Feng said the Chinese consulate in Sydney had changed tactics in recent years and now preferred to use “homeland associations” or cultural groups for pro-Beijing causes, rather than patriotic organisations, which had become too high profile.
Mr Zhou has been referred to the NSW Independent Commission Against Corruption after failing to declare a $4 million connection to disgraced property developer Huang Xiangmo.
Ryde mayor Jerome Laxale used his own casting vote to keep his job. Jeremy Piper
This followed Ryde council granting a key planning approval for the redevelopment of Eastwood Plaza, owned by Mr Huang’s Yuhu Group.
Mr Huang put the site on the market after planning permission was granted and stands to make a $135 million profit. Mr Zhou does not stand to benefit from the planning decision.
Some Chinese like to use so-called racism as an excuse to protect what they have done wrong. — Din Lin, Chinese-language columist
Tuesday night’s council meeting was convened to ask Mr Zhou, who sits as an independent, to step aside as deputy mayor while any ICAC investigation takes place.
Labor mayor Jerome Laxale has referred himself to ICAC, but has not disclosed the details.
Mr Zhou responded to the motion with an impassioned speech, breaking into Mandarin at times, to say the attacks against him were racially motivated because he was born in China.
“These attacks are aimed at bringing down a successful Chinese immigrant,” he said to cheers from the gallery. “It’s time we immigrants fight back and stand up against this bullying and harassment.”
*Chinese-language broadcaster and columnist Din Lin said the criticism of Mr Zhou had nothing to do with racism.
“Some Chinese like to use so-called racism as an excuse to protect what they have done wrong. This is nothing about racism,” he said.
His comments were echoed by Professor Feng who said the “race card” was too often played by Chinese leaders when they were under attack.
Mr Laxale was forced to use his casting vote to break a deadlock on council and defeat the motion that sought to have Mr Zhou and himself step aside.
Mr Laxale’s casting vote was also used to water down a motion for council to formally refer the pair to the ICAC.
Rather, it “noted” a referral had already been made and said if the ICAC was to investigate, then council would fully co-operate.”
Ryde deputy mayor Simon Zhou with his supporters on Tuesday night.
When Quartz decided to ask whether WeChat should be banned in democracies there was no better place to look than Straya:
Like other social media platforms, WeChat is being used more and more by political parties around the world to appeal to potential voters.
Its reach is considerable. It’s the world’s fifth largest social media platform, and has over one billion monthly users globally.
Owned by Chinese tech behemoth Tencent, the multifunctional app started out as a messaging tool and has since evolved into a major publishing platform, used by traditional news sites, individual bloggers and media startups.
For those drawn to its value as a political tool, it holds a particular appeal, as WeChat is not just essential to people living in China. The Chinese diaspora uses the app to connect with Chinese speakers in the country they live in and to stay on top of issues important to the local Chinese community.
For instance, Chinese Americans used WeChat to organize a nationwide protest in 2016.
Politicians from Canada, the US and Australia have all turned to the app to reach Chinese voters in their countries. The best example of this is probably in Australia, where the two major political parties embraced WeChat in the 2019 national election to win over the key demographic of ethnic Chinese voters. Many candidates registered for their own official accounts on WeChat to publish their political messages in Chinese on the platform and some even conducted live Q&As in WeChat groups with hundreds of voters.
Like Facebook and Twitter, WeChat has its fair share of problems with misinformation and disinformation. But the added language barrier and some built-in unique features of WeChat exacerbates the problem. On top of that, WeChat follows a different set of rules—rules set by the Chinese government and its censors.
*In this latest episode of Because China, we go to Australia to understand how China’s “super app” could affect elections and democratic processes of another country.
We break down how misinformation travels within the WeChat’s unique information ecosystem and why the app is a channel for Beijing to extend its censorship beyond China’s borders.
We also talk to people who are pushing back against the norm, urging lawmakers in Australia and beyond to include WeChat in the ongoing conversation about how to regulate global tech companies, prevent the spread of misinformation, and protect citizens’ privacy online.
The story recounts how fake accounts are used to misinfrom and intimidate political parties and individuals with criticisms of China.
*It alos notes how WeChat systematically censors and bans ALL criticism of the CCP. Indeed, Beijing can demand whatever it wants removed.
Alas the video is locked but it is not happy viewing.
*He said he had spent years unsuccessfully trying to convince more senior members of Curtin’s academic staff, in the faculties of Education and Media, to supervise his research into censorship and the Chinese social media platform WeChat.
*WeChat is owned by the Chinese tech giant Tencent, which sponsors events and programs at Curtin.
A professional and personal toll
Mr Jing said he had never formally received a rejection letter from Curtin for his PhD proposal, but he believed it has been cast aside by professors from the School of Media out of fear supporting it could upset Tencent.
Mr Jing said the School of Education also believed his proposal was too controversial.
“The censorship and self-censorship here at Curtin is reaching to a point where I think it’s limiting a lot of potentials for the Chinese diaspora scholars at Curtin,” Mr Jing said.
“So it’s not really delivering the quality a research institute is expected to deliver.
“I do hope that Curtin can do something about this.
A Curtin University spokeswoman said Mr Jing’s PhD proposal was considered by two professors in the School of Media, Creative Arts and Social Inquiry and the School of Education.
The spokeswoman said Mr Jing had also sought advice from an Associate Professor in Curtin’s Centre for Culture and Technology.
“After consideration, all three had determined that the proposal Mr Jing had presented fell outside their areas of expertise and therefore they did not believe that they had the required disciplinary expertise for supervision of a PhD-level topic in the area proposed,” she said.
“Curtin University rejects any suggestion of censorship or self-censorship regarding PhD proposals or any other research projects.”
The university also rejected the assertion that it had been influenced by commercial partnerships like the one with Tencent.
“Curtin, like every other university, has a range of partnerships and relationships with business and industry and a robust system for maintaining the integrity of research and research proposals,” the spokeswoman said.
“Curtin University absolutely supports academic freedom and has well-established policies and guidelines to ensure the intellectual freedom of staff and students.”
“Any influence by companies, Chinese or otherwise, is counter to the policies, guidelines and values of our University.”
Mr Jing said not being able to complete a PhD had taken a toll on him personally.
Ms Dong rejected this theory, saying it was a mutually beneficial relationship.
“It’s a bit exaggeration … I think it’s not only a matter of WA’s dependence or reliance on China, it’s a mutually beneficial cooperation,” she said.
“China benefited a lot, we also depend on Australia in a way in terms of our resource security, the critical resources, the iron ore, the other mineral resources that is very important for our industrialisation and our urbanisation.”
THIS is huge … and this is indicative of how much ‘investment’ … OWNERSHIP one Foreign Investor has gained …
What about Dahua, Country Garden, Greenland …. the list is long … Landbridge and the Darwin Port, mines, power, healthcare, large tracts of farmlands … the ‘BLACK MONEY’ awash in our Residential Real Estate …
‘Barnaby Joyce, Angus Taylor, Australia and the Caribbean’
And for more about …
WATERGATE, Angus Taylor, Barnaby Joyce …
THEN search for more articles concerning …
Sydney lawyerSevag Chalabian, Zhang Bo, real estate company Evergrande,
Firm involved in $80m water deal now funding Huang Xiangmo-linked development
Hong Kong private equity firm Pacific Alliance Group, which invested in controversial water sale, is now funding troubled redevelopment
A Hong Kong private equity group that manages billions of dollars, Pacific Alliance Group, is financing the troubled One Circular Quay luxury apartment building spearheaded by exiled businessman Huang Xiangmo.
*A mortgage over the prime slice of Sydney land is held by a British Virgin Islands company called Global Enterprise Opportunity VIII, which the Guardian has established is a vehicle through which one of Pacific Alliance Group’s investment funds has funnelled money into the development.
*Pacific Alliance Group, or PAG, denies that Global Enterprise Opportunity VIII is in any way affiliated with Huang or his family.
Not only was the deal done without tender, but it soon emerged that the energy minister, Angus Taylor, had been a director of EAA and its Cayman’s based parent, Eastern Australian Irrigation, before entering parliament.
Founded by Taylor’s friend from Oxford Chris Gradel, who is chief investment officer, PAG and the other investors were able to realise a $52m gain on the water rights sold in the EAA deal.
Another investor, EF Realisation fund, which held 9.6% of the Cayman’s based fund, told the London stock exchange it was the highest price ever paid for water by the Australian government.
Taylor faced questions in parliament over what became known as “watergate”, but he has repeatedly said he resigned his directorships before entering parliament in 2013, and that he did not benefit from the water deal.
On Twitter, the exiled billionaire has also called for an investigation into an $11m fee he paid to Sydney lawyerSevag Chalabian, who used to represent the Obeid family.
The money, paid in connection with the purchase by Huang’s Yuhu group of a retail and commercial property development, has been described by seller Seph Glew as an “introduction fee”.
One Circular Quay, which when completed is to contain more than 300 luxury apartments and a hotel complex in two towers located on the corner of George Street and Alfred streets, has changed hands several times, and is now apparently in the hands of a fourth developer, elusive Chinese-born businessman Zhang Bo,a Huang associate who bought the company that owns the site from Yuhu in late 2018.
Huang is reported to have retained the development rights, although a property industry source said the financial scaffolding behind the development has recently been restructured.
Even the City of Sydney Council, which approved the redevelopment in conjunction with the state government is unsure about who owns it. The council continues to deal with the same team of architects and planners who were employed by the Dalian Wanda group, which secured the approval.
*Zhang’s sudden emergence as a key building developer in Australia has come after Huang’s residency was revoked and his assets frozen.
Evergrande enters the deal
Zhang has previously been linked to the world’s most valuable real estate company Evergrande, which raises the question about whether it is now in control of the prime site.
But there are few answers about what is happening at One Circular Quay, fronting the shores of Sydney Harbour between the Opera House and the Harbour Bridge and with views across the water to Kirribilli and Admiralty Houses.
The development has endured a troubled recent history. The site, which was once home to Gold Fields House, was owned by US investment firm Blackstone, which sold it to Dalian Wanda Group in 2015 for $415m.
Late in that year, the project was approved by the City of Sydney, with a 57-storey 184-apartment residential tower and a 179-room hotel on the 4,040sqm site. Final approval was granted in 2017.
But Dalian Wanda Group, its expansion driven by highly-leveraged acquisitions, was placed on a watchlist by Chinese regulators in 2017, part of a Chinese government drive against private-sector debt hurting the country’s financial system.
How Huang Xiangmo swooped
*When Dalian Wanda, headed by China’s richest man Wang Jianlin came under pressure from the Chinese government, the Yuhu Group – then run by Huang Xiangmo – was part of a consortium that swooped, picking up the Sydney project, and the Gold Coast Jewel development at Surfers Paradise, for $1.13bn.
*The other actor in that purchase was Zhang Bo. His new company Dachang Australia, took a half share for $565m. Huang’s Yuhu took the other half.
But company records show Yuhu Group sold the site in 2018 and now appears to have exited the company behind the development, AWH Investment Group.
*AWH is now controlled by two companies Cuilam and Dachang, both controlled by Zhang.
The transaction was several months old before the tax office hit Huang with a freezing order on all of his assets in Australia and around the world, pursuing him for $140m in an allegedly unpaid tax bill, penalties, and interest.
Zhang is not only linked to Huang through the One Circular Quay deal, but has a history with Evergrande, one of the largest property developers in the world.
Cuilam Investments, Zhang’s company, acquired Evergrande’s dairy products business for about $60m in 2016. Cuilam continues to maintain ties with Evergrande after the sale. It has extensive investments in New Zealand.
Evergrande’s chairman, Xu Jianyin, is best known in Australia after he was given 90 days in 2015 to sell a $39m Point Piper mansion by then treasurer Joe Hockey, after the Foreign Investment Review Board (FIRB) found it had been purchased illegally. The property was purchased by the mysterious Lola Wang-Li, an Australian citizen, who lives in a Pyrmont apartment.
IS this a case of guilt by association? It appears so.
FURTHER, it seems Huang has departed our shores, and if this is so most of those with the smallest amount of desire to see justice done will be wondering how much real effort is being put into getting these people to face up in an Australian court where incidentally justice is also real, or will it be yet another one of those cases of ‘nevermind we tried’
LET’s hope at the very least official seizure of assets has or will take place.
WHY should we allow bad behaviour and lies to be rewarded?
LOOKS like public opinion is being shaped to ignore the truth
… those wracking in benefits hoping it will all go away …others in the deep
Egyptian River … and the really bad ones among us trying their very best to hide
it and other revelations …
The deputy mayor of a Sydney council, who has already been referred to the NSW corruption watchdog, failed to declare nearly $13 million of property-related transactions during his first year in office.
Simon Zhou, who is facing a no-confidence vote at Ryde City Council, also failed to disclose his links with property developers and an ongoing interest in gold trading in breach of his obligations as a councillor.
Simon Zhou, left, with disgraced Chinese billionaire Huang Xiangmo.
The Australian Financial Review has previously reported Mr Zhou’s failure to declare a $4 million financial connection with disgraced Chinese billionaire Huang Xiangmo.
It can also be revealed that Mr Zhou and his mother owned nearly $13 million of assets, in addition to shares in 12 companies, which were not declared on his pecuniary interest statements to Ryde Council.
Mr Zhou, an independent who previously worked for the ALP, declared his only income as the council’s $25,000-a-year stipend.
There is no evidence Mr Zhou misused his position on Ryde Council to benefit his property holdings.
Ryde councillors have called an emergency meeting next week to force Mr Zhou and the Labor mayor, Jerome Laxale, to resign following the revelations.
“The rule is, if in doubt, shout,” said Professor Roberta Ryan of the Institute for Public Policy and Governance at the University of Technology Sydney in relation to disclosure.
“If there’s any doubt, you need to declare it.”
Mr Zhou was required to file a pecuniary interest form after his election to Ryde Council in September 2017.
The form covers the full year to June 2018 and lists his only assets as a half share of the family home in Sydney’s Oatlands, purchased with his wife in October 2016 for $2.2 million, and 20 per cent of a former gold venture, AGSX Trading.
The Financial Review has identified five property assets that Mr Zhou failed to declare. These include a six-bedroom house in Dural that he bought in March 2015 for $2.15 million.
He also failed to disclose the Granville apartment he bought in May 2017 for $675,000, according to the liquidator of his company, Australian Gold Exchange.
Mr Zhou said on his pecuniary interest statement to the council that he had no debt, no other income beyond his council stipend and had not sold any property.
In fact, title records show that two weeks after being elected Mr Zhou sold his only property holding within the Ryde Council area, on Avondale Way in Eastwood, for $1.65 million.
In June 2017, before running for council, Mr Zhou set up a new company with other investors, Dural Pty Ltd, which was operated out of his Oatlands home.
His mother, who lives at the same address, held 50.5 per cent of the new venture through her company ZW Holding.
In December 2017, this new company paid $3.25 million for a 2.4 hectare property in Dural. It then hired surveyors and planners to file a new Deposited Plan for the site, a key step in any subdivision.
The property was sold in August 2018 for $3.7 million, weeks after filing the new plan.
Mr Zhou left blank a Yes/No question in the 2018-19 Pecuniary Interest form which required councillors to declare if they acted as property developers or were a “close associate” of a property developer.
Mr Zhou’s $4 million stake in Mr Huang’s Pymble Corporate Centre, on Sydney’s north shore, was held through a company called Zwymble.
The Zwymble shares were originally in Mr Zhou’s name but in August 2017, three weeks before the council election, ASIC was told the shares had been transferred to his mother’s company four months earlier.
But the $4 million stake still had to be declared under disclosure laws, which extend to family members including parents.
The Zwymble shares were transferred from Mr Zhou’s mother to a business associate, Chris Wang, in December 2017.
“It was just a change of mind,” Mr Zhou told the Financial Review in a telephone interview last month. “It was supposed to be an investment company but I was too busy to do it.”
Since 2017, Mr Zhou’s mother has taken stakes in at least 10 companies linked to her son, but in the phone interview he described an ongoing decision-making role with several of these companies.
“I have to support myself, you know,” he said.
Along with failing to declare his directorships and property interests, Mr Zhou is under scrutiny from the collapse of his Australian Gold Exchange, which called in a liquidator in May 2017 owing $2.7 million to the Tax Office.
The ATO later replaced the liquidator with Vaughan Strawbridge of Deloitte, who noted $28 million in cash withdrawals from the company’s bank accounts over nearly three years were recorded as petty cash to pay suppliers and other creditors.
Mr Strawbridge said he was investigating possible recovery actions for “unfair preference payments, insolvent trading, uncommercial transactions and … unreasonable director-related transactions”.
After his election win in September 2017, Mr Zhou told The Sydney Morning Herald, “I’m no longer in the gold industry business”.
“When I decided to run for council, I decided to commit my time to my local work.”
This wasn’t entirely accurate. In June 2017 he had set up a new bullion trading company, ACX Gold. His mother owned 70 per cent, with the rest held by his long-time employee Leigh Prosser, who herself ran unsuccessfully for council on Mr Zhou’s ticket.
Mr Zhou didn’t disclose stakes his mother held in other gold companies including AGSX, Zhou Py Ltd, the former Zhou Group, the former AGSX Investables and Gold Barossa.
“I don’t manage or operate any of those businesses [but] I am keeping an open door to business opportunity,” Mr Zhou said.
The newest gold trading company is 1100 Degrees, which Ms Prosser set up in April 2018 with Chris Wang and Mr Zhou’s mother.
“I was with her in another company, and there was some stock left over,” said Mr Zhou. “It was a very kind offer from her to allocate some shares from her company.”
Celebrations will go off on the mainland, however.
“For the past 10 years, I have been stationed at our command centre … at the most intense moment, just before clock strikes midnight, I would take the stage to count down to the start of the event,” Alibaba chairman Daniel Zhang, who recently replaced Mr Ma, said in a statement.
“This year my most important responsibility is to shop and be a consumer.”
“China is bringing these technologies to scale that we don’t really see anywhere else,” Mr Hendrischke said, referring to the use of big data to ensure demand can be met, and that products are delivered quickly.
“Once we see these technologies perfected they would be transferable to other markets,” he added.
Mr Zhang told an event in Shanghai this week that massive merchandise volume was no longer Alibaba’s primary aim.
“Rather we are looking at strengthening data capabilities, cloud computing power, and logistics networks to weave a digital ‘Belt and Road’ for the welfare of more people,” he said.
WA Asian Engagement Minister Peter Tinley and China Consul General in Perth
A timely warning … but is it largely falling on deaf ears?
WHAT is amazing is the apparent indifference to the possibility that Australia and Australians are setting themselves up to …
-fail to see the warning signs -if this encroachment continues our sovereignty will cease to be of any consequence
TIME is running out
SCOMO says it will not be acceptable to conduct business relationships based on perceived conflicts, that is secondary boycotts will be outlawed … he thinks he has a right to legislate where organisations can buy and invest
BUT he is choosing to ignore the inherent conflict this places upon his lot and their so-called traditions
THEN again it’s apt to remind ourselves it’s the ‘whatever it takes’ rule that applies to everything …
“The best way to understand this is through the lens of [former Chinese leader] Mao Zedong’s tactic of
‘use the countryside to surround the city‘”
WITH the FIRB allowing foreign investment/buy up of Australia … its property … residential, commercial and agricultural … it would appear it’s been that easy for China … and with a member of the CCP in our Parliament … and others in roles in local government, and state government …
AUSTRALIA’s STATES ARE GROWING CLOSER TO CHINA AS THE FEDERAL RELATIONSHIP REMAINS STRAINED
“We’re not going to allow university students to be unduly influenced, we’re not going to allow theft of intellectual property and we’re not going to allow our government bodies or non-government bodies to be hacked into,” he said.
Fortescue Metals Group sells billions of dollars worth of iron ore mined in WA to China every year.
Australia’s trade relationship with China is one FMG’s founder and chairman Andrew Forrest was keen to preserve.
“I find them a tremendous people to work with, to engage with and to make very true friendships from,” he said.
Are we getting too close?
*But author, China researcher and Charles Sturt University public ethics professor Clive Hamilton warned some Australian businesses and state and territory governments had succumbed to intense lobbying by China and become too close.
*”The best way to understand this is through the lens of [former Chinese leader] Mao Zedong’s tactic of ‘use the countryside to surround the city‘,” he said.*
“This was a tactic developed during the civil war against the nationalists in the 1920s and 30s — when the Communist Party could not defeat the nationalists in the city, they had to retreat to the countryside.
“They’re using the same principle all around the world, including in Australia. *
“When the environment in Canberra became more hostile or suspicious or vigilant, let’s say starting about three years ago, Beijing decided that they would focus a lot more effort on the countryside — that is on the outlying states Western Australia, Tasmania, Northern Territory, but also they’ve had these huge victories in Victoria.
“So they’ve been cultivating and building their political influence in Western Australia and other parts of the ‘countryside’ as a way of surrounding Canberra, as it were.” *
“I am very troubled by the clear evidence of re-education camps, where one million Uyghurs have been forcibly detained and indoctrinated into communist thinking,” Mr Hastie told Federal Parliament last month.
Vision, posted anonymously online in September and verified as authentic by experts, showed freshly shaven and blindfolded Uyghurs during a mass transfer of people in China’s Xinjiang Province.
“The Federal Government I think might have gone a bit overboard in their megaphone diplomacy.
“They should, if they have criticisms or they want to take issues up, you take them up in a more refined way, a more subtle way.”
Professor Hamilton said of all the states in Australia, WA was the one that was most under the influence of Chinese Communist Party bosses in Beijing.
“I think that over the last decade or two, political and business leaders in Western Australia have become so hooked on the money that’s flowing in that they’ve decided that they’re willing to trade off human rights and democracy,” he said.
READ TO LEARN WHY … there is a tremor of excitement through the City’s
property market ….
THEN … SHARE!
BECAUSE all … betrayed … Australians really need to know what they are up against!
HOW come cash is again flowing in the Sydney RE Market? Is it because a little while ago our big neighbour to the North relaxed its capital controls … ?
AND did that follow the exclusion by the Morrison Government of the Real Estate Gatekeepers from the Anti-Money Laundering Laws in October 2018 … before the May 2019 Election?
DOES it seem that both these governments are working in tandem with one another?
IS this why Labor lost its Chinese vote? And is this why the rumours ran rife of an ‘unpopular’ Labor Leader?
AND is the price hike for Chatswood … because it has become a Chinese Mandarin City?
THIS Audio explains why!
‘If you get on the hill, and you film down into Chatswood – it’s like this city in the middle of nowhere called Chatswood …
it is just northwest of the Sydney CBD.
It is being built by the Chinese Communist Party.
All the money has come from China’ …
‘This is the most wealthiest couple of kilometres in the entire of
Australia! … This city has happened out of nowhere … massive high-rises …
it looks like Hong Kong … it’s a city being built
ostensibly with China’s money … ‘
There is a seven-bedroom, orange-brick house on sale in Chatswood carpeted in a plush brown, with fake marble floors and grated doors. Outside, a few stunted trees cling to a lawn so small it takes less time to mow than to wheel a lawnmower to and from the double garage and fire up.
Local real estate agent Mendy Lau is trying to sell the Nicholson St property, which is opposite one of Chatswood’s few generous parks. Her pitch includes an “expansive paved terrace and low-maintenance level lawns”. The Hong Kong-based wants $8.38 million – a price that places the outer-suburban-like house among the trophy homes that overlook the harbour from the Lower North Shore.
As property owners in Sydney, Melbourne, Brisbane and Adelaide celebrate what looks like the end of a two-year price dip, the Chatswood house is a pricey cog in one of the most important and least-understood forces driving the $6.6 trillion Australian home market: Chinese cash.
Through their purchasing power, strong family ties and specific tastes, Chinese citizens and Australians of Chinese descent have created microeconomies where the conventional rules of property valuations don’t seem to apply.
Nonetheless, Chinese demand is such a big swing factor that Asian-dominated markets like Chatswood may be a canary-like indicator for property overall.
Ten kilometres and six train stops north of central Sydney, Chatswood is the most desirable suburb for many families from China. Some 34 per cent of the suburb’s residents are of Chinese heritage, and 26 per cent were born in mainland China or Hong Kong, according to the 2016 census.
CAAN: What are the current figures with the Housing Boom peaking in 2017? What are the up-to-date percentages?
Chatswood is a brand for buyers of Chinese descent. Houses in the adjacent suburbs of Artarmon, Roseville and Willoughbysell for approximately 15 to 20 per cent less than similar properties in Chatswood, according to Tim Holgate, the sales director of Belle Property Lane Cove.
From the pork dumplings at the New Shanghai restaurant in Chatswood Chase to the raw fish heads on sale at the Mandarin shopping centre, central Chatswood looks, feels and sounds a little like downtown Shanghai. Many older migrants, uncomfortable driving, insist on living within walking distance of shops.
“I think most ethnic groups, they live together,” says Tina Lee, the owner of the One Agency real estate firm in the suburb. “Most Asian migrants, they like to live in the area for the low maintenance. When they go downstairs there are cafes, shops, supermarkets. You just name it.”
This Saturday, Holgate plans to auction 3 Bowen St on the west side of the Pacific Highway, which places the property in West Chatswood. The renovated, semi-detached house is a 15-minute walk from Chatswood’s main shopping centres – a range that puts it outside the Chinese buying zone.
“If that was 300 metres from Chatswood Chase it could go for $2.5 million,” Holgate says. “Our guidance is 1.8.”
General Chao’s head chef, Son Sewoo, in Chatswood. Edwina Pickles
At the start of the decade, the average asking price in the suburb was nudging towards $1 million, according to SQM Research.
Last January, it hit $2.27 million, making Chatswood one of the most expensive non-beach or harbourside suburbs in Australia’s most expensive city. (To obtain consistent data, SQM relies on sellers’ target prices instead of reported sales.)
*Then, in the Year of the Dog, the Shanghai of the South turned on a penny – downwards.
*The precise trigger remains unclear. The banking regulator had gradually been tightening lending controls since 2014, a policy that led the broader Sydney market to start spluttering in the first half of 2017, and turn down in the second.
*The macro-prudential credit crimp counteracted the stimulus of falling interest rates, but only applied to Australian loans. Foreigners, especially wealthy Chinese who could extract their money from China, were often paying in cash.
*On July 1, 2017,the NSW government had imposed an extra 8 per cent tax on non-resident foreign buyers, who aren’t allowed to buy second-hand homes anyway. In theory, the tax on a $2 million Chatswood off-the-plan apartment for a buyer from China was an incredible $255,490.
*In practice, though, many buyers of Chinese heritage are Australian citizens living locally or in Singapore or Hong Kong, according to one of the suburb’s most prolific agents, who asked not to be identified.
Around the same time as the stamp duty hike, estate agents said they picked up talk that the Chinese government had started enforcing capital controls more rigidly. The claims were hard to verify but entirely plausible.
Max Hong and sister Emily at Chatswood’s Taiwanese Festival. James Alcock
Demand evaporated. By the end of 2018 the average asking price in the suburb was $1.69 million – a drop of 26 per cent in 11 months, SQM monthly data found, and a far greater fall than the 9.9 per cent drop across Sydney over the full year.
The turnaround, as elsewhere, was as abrupt as the decline. When the Liberal Party won the federal election on May 18, the political threat to property investment disappeared.
That month, Chatswood houses bounced up to $2.5 million. Since then, sales prices have averaged $2.42 million.
*“More than 50 per cent of the people coming through our open houses are Chinese,” says Brent Courtney, who works the suburb for McGrath, referring to Australian-Chinese buyers and foreigners. “I’m finding prices are very strong. Probably a 10 per cent gain off the bottom from late last year.”
Six of the seven houses and apartments listed for auction last Saturday sold, according to the Domain real estate site, on a day the city-wide clearance rate was 77 per cent. This weekend, another seven are up.
As a sign of foreign demand, at a time when Australians are fiscally wary, Chatswood’s revival is contributing to a wave of excitment that has swept Sydney’s North Shore and may be influencing the eastern suburbs and inner west – an urban spread valued about the same as New Zealand’s entire housing market.
Sydney-wide house and apartment prices are up 5 per cent since the end of June, according to CoreLogic.
The reality, though, is more complicated than the headlines suggest.
In Chatswood, the new demand doesn’t appear to have been matched by a surge in supply, agents say. In a season which typically provides agents more than one-third of their annual sales, there were 120 houses and apartments for sale on the Domain website at the end of September. A year earlier there were 187.
Earlier this year, billionaire Huang Xiangmo’s permanent residency was cancelled for reasons including character grounds.
Today, The AFR has published a detailed investigative report on how Huang Xiangmo laundered money through Australian real estate to buy political influence:
Huang Xiangmo, the Chinese billionaire at the centre of a NSW corruption inquiry and tax office investigation, used a Sydney property deal to funnel $11 million to a notorious political fixer…
The money was transferred just a month after it became public that ASIO had warned the major political parties about accepting donations from Mr Huang and followed a year of intense scrutiny around his efforts to ensure Canberra took a more favourable line towards Beijing…
“On the surface it has many of the hallmarks of money laundering,” [Mr Fehon, the forensic investigator from McGrathNicol] said…
This follow’s Monday’s AFR report on a large money laundering racket by Chinese:
A Sydney real estate agent has admitted the ultimate buyer of four trophy homes was not a 32-year-old Chinese-born Australian, Zhang Bo, as shown on the title deeds…
Mr Zhang owns six properties in Sydney’s Mosman worth $37 million, but lives in none of them… Only one of the six houses held in his name appeared to be permanently occupied…
The agent who sold four of these harbourside houses, Richard Simeon, confirmed all were bought by different people, even though three of them are held through one company and all are linked to Mr Zhang…
*Five of the six properties were settled without the need for a mortgage…
When asked on Sunday to provide context around his earlier comments, Mr Simeon said he had sold a huge number of properties to Chinese families in recent years. “I don’t know which people they are,” he said before hanging up once again.
Remember, the 2015 Mutual Evaluation report from the Financial Action Taskforce (FATF) stated that Australian property was a prime destination for Chinese laundered funds, and urged Australia to bring real estate gatekeepers within the anti-money laundering (AML) regulatory net:
Australia remains at significant risk of an inflow of illicit funds from persons in foreign countries who find Australia a suitable place to hold and invest funds, including real estate…
*China; Hong Kong, China; Macao, China; Singapore and the United Arab Emirates were seen as major source, destination, and/or transit jurisdictions for proceeds of crime laundered into and out of Australia.
Large amounts are suspected to be laundered out of China into the Australian real estate market. China and other countries within the Asia Pacific region were also seen as likely sources of corruption proceeds that are laundered in Australia…
AML/CTF policies need to better address ML risks associated with… laundering in the real estate sector, particularly through bringing all DNFBPs within the AML/CTF regime.
Indeed, Australia has the weakest real estate AML rules in the world, therefore, has left the door wide open for illegal money to gush through Australian homes:
*This corrupt system is not only inflating the cost of housing, but also poisoning our political institutions as well.
*Embattled Liberal MP Gladys Liu personally poured at least $100,000 into her campaign at the last minute to win the marginal Melbourne seat of Chisholm after being told she didn’t qualify for a significant cash injection from the party.
*Ms Liu donated a “six-figure’’ sum to her own campaign after internal Liberal polling had shown the party faced an uphill battle to hold Chisholm in the wake of Julia Banks quitting the seat.
Ms Liu’s donation will escalate the debate around the Hong Kong-born MP’s connections and fundraising ability.
Sure does. Where’d she get the money?
So, not only does Gladys refuse to personally endorse Australian foreign policy tenets around China, as well as mumbling alarming things about Hong Kong in the Party Room; courts and channels money directly opposed to Australian foreign and strategic policy goals into the Government; occupied senior positions in CCP propaganda outfits, misled Chisholm voters with dubious election day signage; used and abused the credibility of parliament house to aid campaigns for CCP control, she also donated large sums of her “own” cash to buy the Chisolm electorate, then lied about much of it directly into the face of the Australian people.
Peter Dutton once described Sam Dastayari as a “double agent” for far less. Appropriately, he resigned plus answered all questions. How is it that Ms Liu qualifies as a fit and proper person to be in the Australian Parliament when “double agent” Sam Dastayari does not?
She is not. But she holds the Morrison Government’s majority in the palm of her hand so here we are, getting a picture of what favours she is facilitating for her CCP-associated donors in return.