(Yicai Global) July 31 -- The worth of foreign investment in the US residential real estate market declined, while Chinese investors retained their top position with lavish houses mostly in California.
The amount paid by foreigners in the US for residential property reduced 21 percent to USD121 billion in the period of a year from April 2017 to March 2018, data from US trade organization National Association of Realtors shows. This made up 8 percent of the total of USD1.6 trillion in house sales across the States.
Chinese investors' money accounted for 25 percent of the total from overseas investors, as the source nation kept its lead for the sixth consecutive year, followed by Canada. Chinese people paid up to USD30.4 billion for houses, a slight drop of 4 percent. They also bought the biggest number of units at 40,400, which was 15 percent of all.
Chinese potential housing buyers' inquiries about the US market increased 48 percent last month in comparison to last December, which reveals the aim to offset the Chinese yuan's depreciation pressures against the US dollar in the recent months. "Most of the Chinese buyers believe the exchange rate of CNY against the USD will continue dropping within a year," said Carrie Law, chief executive of Juwai, China's largest website for buying overseas property.
Some 52 percent of foreigners bought houses for self-occupation, and beyond that reason, Chinese made purchases to secure their children's education.
The median price paid by the Chinese was some 50 percent higher than the overall median price of USD292,400 among foreign buyers. This is partly because the Chinese buyers prefer purchasing houses in downtown areas in high-value markets, such as California, New Jersey, New York, Texas, and Washington, NAR's report shows.
Most foreigners bought houses in Florida, with 19 percent of all, and California came second with a 14 percent share. Chinese investors favored California the most, with 38 percent of all investments, followed by Texas with 7 percent, and after that, Florida, by 6 percent.
Editor: Emmi Laine