Hundreds of wealthy Chinese property investors taking buying tours to the US
Wealthy Chinese property investors are taking real estate buying holidays in the US as their appetite for buying increases.
Two major companies are organising house hunting tours and newspaper and television reports are claiming that rich Chinese investors are helping to save the US property market.
SouFun Holdings said it expects to organise 10 tours this year for wealthy property investors. 'There are more than 500 people interested in travelling with the SouFun team to look at property in the US,' said Vincent Mo, chairman of SouFun holdings.'
One Chinese investor who has just returned from an 11 day tour in the US with 39 others said that it was falling prices that attracted him. 'The real estate prices in America have gone down drastically. It's a good option for Chinese people who want to buy for investment,' said Yin Guohua, a partner in a law firm who is interested in buying in New York or Los Angeles.
Not all of those on the tours are serious property investors. Some want a quick look around the US. Others want a son or daughter to obtain a US education and think that buying property will help them to get a place at an American University.
But one senior real estate agent said that it would be too difficult for many Chinese to buy in the US unless they already have assets in the country. Howard Rosen, a senior manager at Grubb & Ellis in New York, said that investors with deposits in Hong Kong may qualify but those with assets on the Chinese mainland would not satisfy US sellers.
The real estate slump has made property in major US cities seem cheaper than in China's larger cities. 'If you take a brand new apartment in a first tier city, like Beijing, Shanghai or Guangzhou, you can buy a lot more for your money in the US,' said Anna Kalifa, a vice president of business development at GTC Real Estate China.
Luo Jie, a tour organizer for those wanting to buy US property, confirmed that price is the main consideration. 'You can buy a much better property in America for $400,000 or $500,000 than you can buy here,' Jie said.
And there is little doubt that there are more wealthy Chinese than ever before. According to a report by the Boston Consulting Group China has the world's fifth largest number of millionaires. There were 391,000 in 2008, an increase of 20% from the previous year.