Ultimate guide for China and Hong Kong citizens buying property in the USA

Table of Content

• Why do Chinese invest in US Real estate?
• Major US Destinations for Foreign Buyers from China and Hong Kong
• Chinese Buying Of US Homes Drops 61% To 11-Year Low As Pandemic, Trade War, And A Weakening US Dollar Take Toll
• How Republicans Won The Majority Of Latino Voters In Florida
• Chinese buying up housing in California
• Middle-class Chinese people are buying property in the US as a 'safe harbor' for their money
• tips for Chinese purchasing rental property in the United States

About a third of Chinese buyers purchased property in California, although that figure was down from the previous year. The next most popular destination for international buyers was Texas, especially for Indian and Mexican buyers. Arizona and New Jersey rounded out the top five, with North Carolina, Illinois, New York and Georgia not far behind. Many buyers were buying vacation and rental properties and foreign investors are expected to continue to rise, despite US inflation increase keeping citizens from buying, according to NAR. Zooming in, many of California’s individual investors who real estate brokers work with on a regular basis hail from China.

For Chinese buyers accustomed to rising real estate prices in their home country, properties in Palo Alto fit the conceptual mold of a sure-thing investment. Chovanec cautions that the recent surge in real estate investment is “a drop in the bucket” compared to a true loosening of capital controls. But given the central role the rich play in bidding up Chinese home prices, more activity in overseas real estate could cool the country’s red-hot housing markets.

Why do Chinese invest in US Real estate?

The USA will be a lifeboat for every filthy rich person not already here. Seems like, for this minute at least, bernacke stopped the mortgage rate climb and actually brought it down a hair. Scary how the only indicator folks with skin in the game in mortgages, stocks, bonds, etc follow is the fed and not fundamentals.

During a recent home-buying tour in the neighboring town of Menlo Park, a group of Chinese and Taiwanese buyers marveled at the luxurious backyard of a home priced at just under $2 million. "The Chinese people still see the United States as a safe harbor where they can take their assets and park their money not only for their money but also for the future of their children," Olson told CNBC. The report, authored by economist William Yu of the UCLA Anderson Forecast, expects more of these purchases from Chinese nationals. "The Chinese people still see the United States as a safe harbor where they can take their assets and park their money not only for their money but also for the future of their children," Olson said. While California is still the favorite among Chinese buyers, they are moving into markets in Texas, Georgia and Florida.

Major US Destinations for Foreign Buyers from China and Hong Kong

Further, it’s likely those homebuyers waiting for construction to finish on Evergrande homes will be bailed out by the Chinese government. In fact, the Chinese government — more heavy-handed than the U.S. when it comes to taming financial disasters — is expected to work with Evergrande directly to soften the blow of a potential default. But while this flow of funds may work to deflate Chinese property valuations, it may also help contribute to skyrocketing prices in the Bay Area. But that process can become a positive feedback loop, as investors’ own actions reinforce their beliefs about the ever-rising value of assets.

Here is a house which had not sold for nearly 40 years . Then sold in early 2012 for $420K as a fixer upper. There was some upgrading, perhaps $75K, (not sure if the flipper was Chinese but the owner/occupier now is Chinese). For the not rich enough Chinese nationals they will have a hard time holding onto any wealth outside of the control of the Chinese Mafia State. And when the Chinese searched on Trulia, they focused largely on the West Coast, including Los Angeles, Orange County, Palo Alto and San Jose in California, and around the Seattle area.

Chinese Buying Of US Homes Drops 61% To 11-Year Low As Pandemic, Trade War, And A Weakening US Dollar Take Toll

Getting a mortgage in the United States eliminates the risk of foreign exchange rate fluctuations in your mortgage payments and gives you peace of mind. According to real estate tracker trulia.com, median home prices in Palo Alto have gone up 16.8 percent in the last 12 months, with the price per square foot jumping 23.4 percent in that time to $1,107. Local realtors have attributed that rise partly to the impact of Chinese buyers who are using cash to buy houses a continent away, often sight unseen. These all cash buyers from China are not your traditional Chinese immigrants who work their way here the right way. The places that traditional Chinese immigrants live in are no longer what they used to be.

To give you an idea of the Chinese interest in California housing, we presented at Pacific Union’s annual housing outlook conference last year, which was broadcast live at three venues in China. Over the past two years, Chinese buyers have been snapping up property in the city, driving up prices and possibly contributing to an emerging bubble. When/if I ever sell I could care less who buys it. It comes down who has the best offer with the best backing to come up with the money.

Florida accounted for 24% of all international real estate purchases in the US while California ranked second (11%). Chinese buyers accounted for 18% of the .2 billion that foreigners spent on homes during the 12 months ended March 31, according to the National Association of Realtors. While no one would say specifically why certain families were shying away from the media, some alluded to the fact that many of the buyers don't want any questions about where the cash is coming from.

Likewise, buying property in the United States from China or Hong Kong may appear to be a daunting task. In the first quarter of this year, Chinese buyer inquiries for U.S. properties on Juwai.com, a Chinese real estate site, were down 27.5% from a year ago. Inquiries have been down in four of the last five quarters. A burgeoning middle class is now looking to invest their money in a safe haven, away from China's polluted air and political and economic uncertainties. Additionally, in China you never have home ownership. "So they watch these high-end videos that walk people through the property and they a sense both the neighborhood and the house and then they will just wire the money in," Repka said.

As the channels for, and savviness with, overseas investment grow, domestic property markets will lose their captive audience of investors. My next door neighbor sold and moved out 8 months ago. They look like a normal family, but they must be criminal masterminds since they bought cash. There are PLENTY of people who have American dollars or enough cash to buy property here. The ignorance and arrogance of assuming foreigners cannot afford to buy property here is laughable.

California is a top location for Chinese buyers, with a specific demand for San Francisco, and there's growing interest in Texas, Florida, and Georgia, Olick reports. We invite you to use our commenting platform to engage in insightful conversations about issues in our community. We might permanently block any user who abuses these conditions.

Their main problem is that they have so much illegal money, that they do not know how to hide it. The hard working Chinese all live in dorms , work 7days a week and go visit their families a few times a year. I lived in SE Asia for a while – and there were very stringent restrictions about foreign nationals being able to buy property . The idea was to protect the domestic population from keeping property out of reach. They have huge ghost cities that would house millions but are virtually enough. However the way in which China counts its GDP is based on the construction rather than the sale of these homes.

Buyers have further disrupted the market by offering cash for houses, often sweetening the deal by throwing down numbers well above the asking price. Several lenders in the San Francisco area now specifically cater to Chinese buyers. The median price of a home sold to a Chinese buyer dropped from just under $530,000 in 2017 to $439,000 in 2018, according to the Realtors. And while California is still the favorite among Chinese buyers, they are now moving into markets in Texas, Georgia and Florida. Chinese investors were the most active buyers of US real estate last year among foreigners — spending a record $6.1 billion on homes mainly in Florida and California, according to the National Association of Realtors. Global capital is flowing into the US and it’s not buying govt debt.

Initially, it was wealthy Chinese buyers purchasing million-dollar properties, all in cash. Now more middle-class Chinese buyers are searching for lower-priced homes and they are using mortgages much more often. China is experiencing a property bubble concerns, which was further heightened by the Evergrande issue. In contrast, US real estate investment is relatively stable and secure investment coupled with capital appreciation in USD.

That’s been going on for 15+ years, due to easy citizenship requirements. Your hard-earned cash will be useful at the opportune time. Don’t be in a hurry to fall into the same trap that ensnared so many before you. Keep saving, clear your debts, and ready yourself when your opportunity arises. Let’s make air bags and seat belts and bumpers optional.