The Chinese are Top Buyers of US Real Estate
The Chinese have bought total of $27.3-B, or 29,195 houses in the US last year. What these numbers tell us is China has been the largest buyer of US homes for the 2nd year in running
Increasing activity has brought both the dollar volume and number of units sold to levels far exceeding that of any other foreign demographic.
In terms of dollar volume, the Chinese bought 26.7% of the total amount of residential property sold, notes Lawrence Yun, Chief Economist at US National Association of Realtors (NAR) as quoted by news media on Saturday.
In Profile of International activity in US Residential Real Estate, market researchers at NAR outlined some major trends in Chinese activity in the US market.
Among the major foreign buyers, Chinese buyers tend to purchase residential properties in central cities and suburban areas with relatively higher property prices. The average purchase price among Chinese buyers reached $936,615, almost 3X of that of Canadians, the 2nd most generous buyer group.
About 33% of Chinese buyers purchased residential property in California, New York, Texas, Washington, and New Jersey.
With roughly 39% of Chinese buyers buying in states other than these Top 5 states, they are among the more broadly geographically distributed foreign buyer groups.
Notably, 10% of Chinese buyers made purchase in the City of New York alone. Other buyer groups tend to purchase properties for vacation purposes, while New York drew Asian buyers most likely for reasons related to geographic proximity, cultural similarities, college prep schools, colleges, universities and job opportunities.
Buyers from China were more likely to purchase residential property for the use of a child studying at a US university, as 13% of Chinese buyers purchased the property for the use of a student.
Foreign buyers from China were more likely to pay cash.
50% of reported transactions were all-cash sales, while among Chinese this number is 71%, and only 20% obtained mortgage from US sources.
Asia Society and Rosen Consulting Group have published a joint report on Chinese investment in US real estate, suggesting that Chinese investors have spent $110-B on US properties in the past 5 years. The number is seen growing by 20% every year and may reach $218-B by Y 2020, the report concludesed