According to a report published by NAR on the twelve month period ending March 2014, Chinese house buyers accounted for the largest sales dollar volume in the U.S. real estate market. Chinese house buyers had spent a total of $22 billion to buy American houses during this period. This is a steep 70% increase compared with last year.
California, New York and Washington are some of the favorite regions to Chinese home buyers because of the large number of business, technology and education centers in place, or the significant number of Chinese-Americans already living in those regions. These business or social links add favorably to the decision on where overseas Chinese will want to buy a house.
This increasing interest of overseas Chinese buyers and their ability to pay all-cash are getting more and more attention of US real estate developers as well as American real estate agents. As such, many of these firms are actively promoting their new developments or listings to the Chinese audience. These promotional activities entail activities such as posting listings on website in Chinese language, attending overseas real estate exhibition in cities such as Hong Kong, Beijing and Shanghai, or visiting China themselves to build business relationships.
However, because of certain government policies and some other factors, Chinese buyers currently do not have a substantial effect on the overall trend of the U.S. housing market. The Chinese government has legislation in place that is capping the foreign transfer of funds out of Mainland China to a maximum of $50,000 per year, limiting many wealthy and law-abiding Chinese to buy American houses. While this is certainly a limitation at the moment, many wealthy Chinese have opened bank accounts in Hong Kong or other offshore places in order to facilitate money transfers to the US. Furthermore, there is an active movement within the Chinese government to liberalize the yuan, the Chinese currency. One of the items that will be addressed by the Chinese government will be the capital controls currently in place. It is expected that these capital controls will be gradually removed in order to make the currency fully convertible. As such, the limitation of $50,000 transfer per year is expected to be relaxed and over time disappear. This will open up the US real estate market to an entire new group of the Chinese population.
As such, the trend of Chinese buying a home in USA is not only expected to continue but will accelerate.