Top Global Real Estate Markets for Affluent Chinese

Compliments of Forbes Magazine:

Having Two Homes In China Is Not Enough

For the truly affluent Chinese, of which there are hundreds of thousands these days, having a home in Shanghai and one in Hong Kong is passé. You've made your neighbors jealous if you have a home in Malibu. In fact, according to the National Realtors Association, Chinese buyers accounted for 12% of all the non-American buyers of California real estate in March of 2013. That puts them only behind the Canadians, which accounted for 23%. Here's the kicker: China's home buyers spent more than twice what the Canadians spent, dishing out upwards of $425,000 for a piece of the California Dream. Forbes spoke with Andrew Taylor, the Aussie CEO of Juwai.com, China's biggest real estate source for those looking to buy overseas or connect to those who are on the prowl for property. Here's Juwai's top 10 most searched for destinations, along with comments from Taylor. Sales data not included.

No. 10: Cyprus

Cyprus may be a mini-Russia. It's the million ruble business man's go-to offshore haven. And now their southern neighbors, the Chinese, have discovered the tiny island. "It's an easy market to get a visa. You can buy a home for maybe 300,000 euros and if you hold it for three years you can get residency. Once you establish residency, that can get you access to an E.U. passport," says Juwai's CEO Taylor. "This is the British Virgin Islands of Europe. Good banking, despite the recent crisis. You can get  your money in and out easily. We've had customers selling 160 units every quarter to mainland Chinese. Those are good sales numbers."

No. 9: Portugal

At first, Portugal seems hard to understand. But digging deeper, it becomes obvious. Besides a weak real estate market with plenty of affordable housing, it has historic ties with China.  Portugal once ran China's casino island Macau. "There are very good deals to be had in Portugal these days and it has been making headlines in China because of investment visas. If you get an investment visa, like Cyprus, you're one step closer to an E.U. passport," says Taylor.

No. 8: Thailand

The Wat Chalong temple in Phuket, a hot summer resort town. "Chinese can buy condominiums here on the cheap," says Taylor. "There are many Chinese in Thailand and there is lots of new manufacturing money there.  The motives for buying here are different than anywhere else. People aren't buying in Thailand thinking of the future for their children. They are buying because it is near their factories or because it is their favorite holiday spot. It is always packed with Chinese. If you're one of the thousands that are there every holiday, why not just buy a condo? That's what they are doing now."

No. 7: Germany

"Nice view, Chancellor Merkel. I'll take it." Sure the Chinese love Paris for the fashion, but France does not make the cut of top 10 destinations for China home buyers.  "In parts of China, there are more Chinese that speak German than Spanish," says Taylor. And, sorry France, but Spanish is spoken globally more than any other language in Europe. "The interest in Germany is mostly from executives from the larger corporations," he says. Germany's Volkswagen and Siemens are huge in China. "Germany has grown through word of mouth and now people are buying that have no connection at all to big German multinationals. I think it is going to move up the list in terms of popularity," he says.

 

No. 6: New Zealand

New Zealand is like an offshoot of the more popular Australia, much in the way Canada is for U.S. property buyers.  China and N.Z. also have a free trade agreement, so the two countries are friendly. "It's a beautiful country. No pollution. And the number of Chinese students in Auckland is on the rise," says Taylor. "For the Chinese buying there it is more about their children's college education. It's a lot cheaper than Melbourne," he say about the Chinese home buyers' favorite Australian city.

No. 5: Canada

Toronto is becoming a hot spot for Chinese buyers. "At first the Chinese were buying in Vancouver, but now the trend is moving eastward to Toronto and Montreal and that is going to have a bigger impact on those cities," says Taylor. Canada is also an official travel country to China, which means it is not hard to get a visa. Canada has the welcome mat laid down for Chinese real estate investors.

No. 4: Singapore

Buyers check out Singapore's "Jurong-Lake-District" while at a Cannes World Property market forum. "Singapore has always been popular and will continue to be so," says Taylor. "It's an Asian meeting port, really, but lot of it is fueled by China. There are lower taxes and it is in the same time zone. It has great universities and is very entrepreneurial. Jackie Chan has a place in Singapore, so it is very much in vogue," he says. Singapore is so hot that the government there has decided to clamp down on foreign buyers, dominated by the Chinese.

No. 3: The United Kingdom

What is that soldier carrying? That's a lot of heat for a Queen's Guardsman. The real U.K. saw Chinese investors pump 1.6 billion pounds into the housing market in 2011-12 and Juwai expects it to rise to at least 2.1 billion pounds in the 2012-13 period ending June 30. "U.K. is being bombarded right now with Russian, Greek and German money. The Chinese are following suit. Global real estate investors see it as a safe haven," says Taylor. Same rules apply for the affluent Chinese; great city, great educational institutions, great lifestyle. Fish and chips, anyone?

No. 2: Australia

Australia is the United States of the Southern hemisphere. The world's oldest China town is in Melbourne, not San Fran, or New York. The time zones are similar. And as a place of business, Australia is one of only three nation to have direct currency swaps between the Chinese yuan and Aussie dollar. "China loves the fact that Australia has a strong and safe banking system and a solid housing market," says Taylor. "They did not go through the same housing related pains as the U.S. and Europe did. Plus Australia has great weather and is loaded with Chinese so they won't have a hard time with the language."

 


No. 1: The United States of America

We are No. 1! It's true! Finally! "Nothing compares to the United States," says Taylor. "You have the Hollywood factor there. Most of the U.S. buyers are cash buyers." And they are buying everywhere, from the obvious spots like China rich southern California and San Francisco, to the most unlikely places like Detroit.