War on corruption drives money away to Australia

More wealthy Chinese are moving their money out of China to invest in Australia's property market as a corruption crackdown in the world's second-largest economy gathers momentum, according to property consultants and lawyers.

War on corruption drives money away to Australia

They said their clients have told them they have legitimate funds to invest but were concerned about being caught up in an investigation that could include dozens of associates of the main target.

David Green-Morgan, global capital markets research director at real estate services firm Jones Lang LaSalle, told Reuters, "What we see at the moment is that there are more Chinese who would likely send more money out of the country so they don't get caught up in this crackdown."

It's one of the most visible signs of the fear of President Xi Jinping's 18-month-old drive against the pervasive graft that he says threatens the Communist Party of China's survival.

Beijing's campaign has particularly targeted "naked officials", the term for State employees whose spouses or children live overseas. The Party often suspects such officials of using such connections to illegally move assets.

Ordinary Chinese citizens can legally transfer only $50,000 overseas each year, but vast sums leak out of China through a variety of loopholes, such as funneling money through Hong Kong.

"The restrictions in China are becoming more onerous," Green-Morgan said. "That's triggered an increase in the amount of money that's looking to move out of China or probably is already outside of China and is looking to be spent."