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As the Chinese real estate bubble threatens its own and several other economies around the world, several cities have already started easing the stringent housing curbs that bogged down buying activity in the country. (Photo : Reuters) |
We already knew that with the Chinese housing market down in the dumps, a large number of investors from the world's second largest economy were looking to invest in the U.S. real estate. But, it's not just the big players who want to cash in on the American property segment. Small investors from the country have now started following their richer, larger counterparts.
The Wall Street Journal names several small builders who have started taking on residential projects in prominent cities like San Francisco and Orange County. The publication explains that since the Chinese developers are struggling to unload the excess supply of property in their country, profit margins have been slim and the business has been hit hard.
To keep the money flowing, these developers are now looking to invest in offshore property and hope to gain steady returns from the U.S. housing market.
According to a previous survey conducted by the National Association of Realtors, foreigners made up about 7 percent of the total home sales of which Chinese buyers accounted for a major part. The Chinese snapped up property worth $22 billion by the year ended March 2014; that is a 19 percent spike on a year-over-year basis.
Also read Most Popular US Markets for Foreign Buyers
But it's not just America. Chinese investors are everywhere. Below are five top countries the Chinese are venturing into:
3. Canada
According to the South China Morning Post, investors of the People's Republic purchased about 10.2 percent of the new homes for sale in central London for the year ended July 31, 2014.
"Five years ago, they were not really in the market. Three years ago, they were at the tip of the market. But now they are in the marketplace," Liam Bailey, global head of residential research at Knight Frank - the property intelligence firm, was quoted by the publication.
And the global markets are welcoming buyers from China with open arms. In fact, some American real estate agencies are taking their property portfolio to the investors themselves.
"The Miami Association of Realtors, the largest local real estate association in US, will visit Beijing and Shanghai next month to introduce the city and its properties to mainlanders," SCMP notes.
Experts believe that the influx of mainland Chinese buyers will increase now, especially, as the asset bubble is about to burst. Home prices have already started cooling in most major cities of China.
Home prices in 288 Chinese cities declined 0.6 percent in August on a month-over-month basis, according to data provided by the China Real Estate Index System.
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