Signs are emerging that Chinese property investment abroad will not slow down, despite the recent economic turmoil, as wealthy companies and individuals look for stable markets to shelter their money abroad.
Australia has been the big winner so far this year, since it has had the most foreign real estate investment. Australian Treasurer Joe Hockey told The Wall Street Journal recently that Chinese investors are “looking for safe, stable, secure investments” and that, “Australian real estate is very attractive for them in that regard.”
China’s currency devaluation earlier this month set off a global sell-off of stocks, and concern among investors over the country’s economic health. The Shanghai Composite index dropped by nearly one-quarter earlier in the week, before rising 5.3 per cent. Any increase in Chinese investment would come despite the yuan’s lowered buying power internationally.
Andrew Taylor, co-CEO of Juwai.com, a Chinese website that helps people to search for homes overseas, said, “If wealthy Chinese feel that the recent devaluation is the beginning of a much longer and deeper depreciation, they may be motivated to move liquid assets overseas before that happens.”
In the United States, Chinese investors also became the biggest group of foreign buyers. During the first half of 2015, Chinese investment in overseas commercial properties came in at $6.5 billion and is on track to top last year’s total of $10.5 billion, according to CBRE.
Michael Cole, a real estate market analyst at mingtiandi.com, a website that tracks Chinese real estate activities, stated, “If you look at the Chinese investments in the U.S. this year, those companies have lowered their currency risk and diversified their holdings. Those are very smart investments.”
