Some 55% of properties purchased by foreigners in America are now purchased by Chinese buyers according to a new report. The data shows that Chinese buyers invested a whopping $9 billion dollars in US residential property in the 12 months running to the end of March this year.
American property is widely regarded as a good investment for a diversified portfolio, but according to Business Week the main motivation for Chinese buyers to buy in America is to get their children into top US universities.
"My company has serviced more Chinese clients this year than at any time in the past, and sales transactions can often be completed quickly as many Chinese purchasers prefer all-cash deals." said Pamela Liebman, president and chief executive officer of the Corcoran Group, a New York real estate firm.
Data from the National Association of Realtors last month showed that non-U.S. buyers accounted for $82.5 billion in residential property sales in the 12 months ending March 2012. Making up 11 percent of this total, Chinese buyers became the fastest growing investing group in recent years.
Reasons for buying are vast and varied among the foreign buyers, as you'd expect, but it is agreed that universities are by far the biggest attraction to Chinese buyers. "For Chinese parents, the most important thing is education" says Cathy Zhao, a real estate broker in Maryland.
In spite of rapidly growing Chinese investment, compared with the market size of New York, "the number of Chinese purchasers of New York real estate has not reached the critical mass it would require to impact prices," echoed by Smith of the NAR.
- Thursday 09 August 2012