Overseas property experts predict that Chinese Investors hungry for international real estate ownership may switch their focus from Australia to the US? Chinese investment in commercial property and land deals totalled US$3.5 billion in the first quarter of this year, down 20.5 per cent year on year, according to figures from real estate agency Jones Lang LaSalle. 

The Chinese have a huge appetite for Australian and international real estate China moved up one spot to become the second-most active cross-border investor after Germany

Juwai.com, an international property listings service website, said visits to its  sites looking for properties in US, Australia and UK is surging. Enquiries for Seattle's real estate more than doubled in 2015 and for Los Angeles county rose 78 per cent. In top destination cities such as Melbourne, Sydney, Los Angeles, London and San Francisco, mainland-based inquirers make up a majority share.

Overseas property website Homesgofast.com founder Nick Marr’

It’s clear that Chinese investors in Australia have caused concern with Australians who were experiencing hikes in Australian real estate prices. The feeling is that overseas investors from China were treating real estate as speculative investments, purchases where being made by very wealthy Chinese investors causing a potential bubble.”

The Chinese Are Coming or Are They?

Learn more about the new Australian restrictions on Chinese property investors from this video by Today Tonight News

 

New restrictions in Australia make now make it more difficult for Chinese to obtain loans from Australian banks but like most restrictions determined wealthy buyers may not find them a reason to move away from Australian real estate.

Cushman and Wakefield head of capital markets for Australia and New Zealand James Quigley, who specialises in commercial property, pointed to a new wave of Chinese investors that were undeterred by such measures.

He cited moves by large Chinese institutions, including insurance and asset management companies, as well as high-profile developers who dominated initial investing. Their activities would be supported by lesser known, small to mid-cap companies and developers, private equity funds and wealthy individuals, he said

Despite the furore about the potential sale of the S. Kidman cattle station empire to Chinese interests, Mr Quigley noted the number of investment approvals granted over the past three years to Chinese groups had jumped by 416 per cent.

Hong Shihong, a partner at US-headquartered law firm Dorsey & Whitney LLP, whose client are high net-worth individual Chinese with a disposable asset of at least $1 million, said this group's interest for US property is predominantly driven by desire to diversify their assets and hold more US dollar-denominated assets.

"Home price surge in Chinese cities actually compelled them to consider more about US properties because that made them feel more insecure," Hong said. "From appreciation perspective US properties can't compete with Chinese ones, but they endow a rare sense of security."

Chinese investors, described as relative newcomers to the US market, have rapidly increased purchases of US residential properties from $US11.2 billion ($A15.45 billion) in 2010 to $US28.6 billion in 2015, according to the Asia Society and Rosen Consulting Group report. Between 2010 and 2015, Chinese buyers put more than $17bn into US commercial real estate, with half of that spent last year alone. Unlike many countries, there are very few restrictions on what foreigners can buy in the US.

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Author

  1. avatar
    Nick Marr

    Nick Marr is the founder of Homesgofast.com and behind property marketplace TheHouseShop.com and Europe's most established dedicated European property portal (online since 1998) Europeanproperty.com. Nick advised the UK government to help change legislation to make advertising real estate online easier for UK property businesses. The result has been a flourish of innovation creativity helping all stake-holders to greater flexibility allowing for new online models to exist today. Working with thousands of international real estate agents, developers and homeowners worldwide allows him to gain a unique insight to the changes in both digital marketing and the real estate sector. You can find out more about him at NickMarr.com