A great amount of cash from Chinese buyers continues to pour into the United States real estate properties. Multi million dollars are paid for luxury homes and hotels on the West and the East Coasts with the major cities like New York, Los Angeles and San Francisco being the favorite places. Mainland China real estate buyers have been snapping up high-priced commercial buildings in the Manhattan area.
Canada is on the lead as the largest foreign buyer of homes in the US. China follows behind, with $7.4 billion in total sales in the past year. This figure is 24% higher than the sales in the previous 12 months, according to a report by the National Association of Realtors. With regards to commercial properties, the Chinese buyers also paid $1.71 billion in 2011, which is more than 4 times the amount they invested about 3 years back.
The majority of Chinese buyers want to buy US properties because they want their children to be educated in the United States; or they want to do business in the region, or for purposes of immigration. A smaller portion, about 40%, wants to own properties as their investment. A Chinese couple buying a Versailles style mansion for $34.5 million made news last month. The property is in Sunset Boulevard, Beverly Hills, California. Only 6 months ago, full-floor, high rise apartments worth $50 million each, were sold to Chinese buyers.
However, only just recently, these buyers from Mainland China and Hong Kong are starting to look beyond their previous targets which are prime locations like San Francisco, Los Angeles and New York. They are beginning to get attracted by the Florida real estate. It is obvious that their fall perception about Florida not a safe state have changed. The Chinese loved to watch the TV program CSI: Miami, or Miami Vice. Homes in a golf community in Fort Myers, Florida are selling fast to the Chinese. The houses are sized at about 2,500 sq. ft. and are completely decorated. The prices are less than $250,000 which the Chinese consider as very low. There is also great inventory.
- Some Chinese buyers who have children want a place near good public schools. They buy in various places in Florida, such as Fort Myers, Tampa Bay and Miami, and in California such as Del Mar, Scripps, Carmel Valley, and Racho Bernardo. Others do not have plans of moving to the US, but want to look for properties that can give them above average profitable investment opportunities. They are coming to the US by the dozens, and look for foreclosed homes. Their purpose is to buy distressed or run down properties, make improvements on them, and then sell for profit. Chinese investors want to have a profit margin from 10 per cent up to 12 per cent, and want to make a sale 4 to 5 months from date of purchase.
With Florida real estate prices starting to show improvement, this is a great time for the Chinese real estate buyers to go down to Florida, take a look, and make their purchases.