Outbound and inbound investment in the Asian Real Estate market
The Asian real estate market is poised for growth as foreign investors purchase property on the continent. At the same time, Asians are investing in real estate around the globe. Reportlinker’s research shows that each group of investors is aiming to multiply their wealth as they take advantage of growth potential in these markets.
Here are five ways investment is pouring in and out of Asia:
- Chinese invest heavily in the United States: The Chinese have invested heavily in the U.S. in the past three years. Last year, the Chinese purchased $28.6 billion in residential properties, making them the largest group of foreign investors. They also purchased $8.5 billion in commercial properties. Chinese favor the U.S. market because they believe it is stable and offers the highest appreciation value. Vacation homes and homes for Chinese foreign students also have boosted purchases. New York City, San Francisco and Miami are three markets the Chinese are particularly interested.
Source: The Real Deal
- Asian investors looking for U.S. hotels: Foreign investors, especially the Chinese, are seeking high-end properties and hotels. These investors are taking advantage of the increase in tourism. In September alone, American company Blackstone sold 15 hotels, most of its hotel and resort investments, to Chinese company Anbang Insurance Group. Anbang also owns the Waldorf Astoria, which it purchased in 2015. Blackstone also sold one-quarter of its Hilton Worldwide Holdings to another Chinese investor, HNA Group, for about $6.5 billion. Source: Bloomberg
- U.S. election good news for Australia: The U.S. election of Donald Trump, however, has the potential to make the nation less attractive to foreign investment. Chinese investors, especially, are more likely to pour their funds into nations they believe are less hostile. Australia is an obvious choice. The nation is geographically close to Asia, has a stable government and has regulations that favor foreign investment. Analysts “expect an increase in Chinese and Asian investment into Australia as a result of the election but it’s hard to predict the magnitude and scale,” Ren Wong, CEO of ASX-listed financial and property services group, N1 Holdings, told News Australia. Source: News
- Chinese love to invest in properties: At the beginning of the century, there wasn’t much interest in making foreign investments, but now the Chinese love investing abroad, Catherine Chan, head of Colliers International’s China international property department, says. In addition to the U.S. and Australia, Chinese investors also look to a number of other nations including Canada, the UK and New Zealand. The UK is the a favorite for investors who don’t see Brexit as a negative. London is thought to remain the world’s financial hub. The decrease in the Pound Sterling’s value also means investors can afford properties they otherwise couldn’t. Chan says even workers who earn as little as $35,000 annually are making investments. Source: Ecns
- Investing in Chinese property remains strong investment: In October, real estate growth in China grew 13.4%, the highest rate since April 2014. The other months this year also saw growth. The market has begun to stabilize, but that hasn’t stopped investors, although growth probably will begin to slow next year. “The impact on investment figures will probably show later as sales are usually hit first,” Wendy Chen, a Shanghai-based economist, told Today. For now, though, new construction increased 19.9% in October compared to 2015. Source: Today
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