A new wave of homebuyers from China is snapping up luxury properties across the U.S., injecting billions of dollars into the country’s residential real estate market.
The industry is scrambling to court these new buyers. Some developers of new projects are installing wok kitchens, putting lucky numbers on choice units and following feng shui principles; others are packaging property sales with government programs specifically designed to encourage foreign investment. Real estate agencies are flying representatives to China, and hiring Mandarin-speaking brokers.
In New York, Los Angeles and even Miami, buyers mostly from China — and some are from Hong Kong, Singapore and Korea — are radically altering the landscape. Last month, a Chinese couple paid $34.5 million for a Versailles-style mansion on Sunset Boulevard in Beverly Hills, CA. A year earlier, a Hong Kong businessman paid about $28 million for a nearby estate.
Over the past six months in New York, several full-floor apartments in a new Manhattan high-rise called One57, each with a price tag of roughly $50 million, have gone into contract with Chinese buyers, according to two people close to the situation.
In a nod to Asian buyers, the building put many of its most luxurious full-floor apartments on the 80th through 88th floors — an ingenious way to appeal to the Chinese belief that eight is the luckiest number. Apartment 88, in fact, is under contract to a Chinese buyer for around $50 million.
Fifteen buyers from Asia have purchased roughly $1 million apartments at New York’s 515 E. 72nd St. in the last six months. In downtown Los Angeles, half of recent buyers for the new Ritz-Carlton Residences, which AEG developed, are from Asia. Some buy in bulk: Late last year, Fang Yi Liu, a Shanghai businessman, snapped up 17 apartments for a total of $14 million in the Artech, a modern glass building resembling a cruise ship that overlooks the Intracoastal Waterway near Miami.
Interest is growing even in parts of the country China-based buyers weren’t traditionally interested in. Richard Zhou, a 41-year-old investment advisor who lives in Shanghai, paid $200,000 for a property in a large golf community in Fort Myers, FL, last year. He said he bought in the community sight-unseen, trusting his friend who had purchased a home there a few months earlier.
Mr. Zhou spent two weeks studying the U.S. real estate market and quickly decided Florida was a good bet because, he said, it was highly impacted by the financial crisis, adding that later in his life he plans to retire there. Florida is definitely a sunshine state, the weather is really pleasant, and the air quality is very good. Also, the food is safe, too, he added.
Buyers from Hong Kong and China accounted for $9 billion of U.S. home sales in the 12 months ending in March, up 89% from 2010, making them the second-largest group of foreign buyers of homes in the U.S. behind Canadians, according to data released earlier this month by the National Association of Realtors. And many real estate agents say those figures are too low, as they track only sales on the multiple-listing service and don’t reflect private sales.