Chinese citizens have become the prime buyers of real estate in the US

Almaty. May 16. Silkroadnews – Chinese citizens have appeared to be the prime foreign buyers of real estate in the United States, they also invested billions of dollars in these purchases while searching the most secure offshore assets, the British newspaper “The Guardian” writes.

“Last year, thanks to the Chinese citizens’ desire to acquire residential and commercial real estate, their investments in this area reached $110 billion for five years. Despite the slowdown in the number of transactions due to the attempts of Beijing to stop the outflow of capital in the second half of the current decade the volume of Chinese investment in the US property is likely to double to $218 billion,” said the publication referring to the survey by the consulting group Asia Society and Rosen Consulting group.

It is noted, though, that the data may not reflect the full picture.

“According to the authors of the survey, the numbers they got are based on the open and public data of the real estate sector, thus, do not reflect the full picture. What is missed here is the information on the purchases of real estate by the intermediary companies, brokers and trust funds not disclosing the sources of their funding,” the publication states.

However, it also notes that for the last 5 years China’s citizens have invested $93 billion at least into the purchase of residential real estate, and within the period from March 2014 to March 2015 the volume of such transactions amounted to $28.5 billion. Thus, China bypassed Canada whose citizens used to rank the first among the foreign top buyers of the US real estate.

New York, Los Angeles, San Francisco and Seattle are reported to be the most popular among the Chinese citizens. Chicago, Miami and Las Vegas are in demand as well.

The publication says the Chinese citizens normally buy residential properties at prices higher than the average over the United States. Thus, the Chinese buyers pay around $832 thousand on the average for a house in the United States, while other foreign buyers pay $499 thousand.

The survey authors project further growth of transactions on purchase of commercial real estate by the Chinese companies for the future. For example, last month the Chinese conglomerate HNA announced its intention to acquire a group of 1400 hotels of Carlson Hotel chain owned by the Radisson brand. At the same time, it was quite recently when the Australian government blocked an attempt by the Chinese Dakang Holdings to buy the Kidman farmland empire, which assets cover 1.3% of the country’s area.

It is reported that since last year one of the reasons behind the Chinese citizens’ intention to take out capital from their country and invest it in dollar-denominated assets is a concern on the continuing yuan’s decline.