There has been a massive increase
in Chinese investors looking to buy internationally as a result of
a decrease in property value in China. Cities like Boston are
becoming prime locations for investment. According to
Jing Daily, a digital publication that releases luxury
consumer trends in China, residential real estate is the most
popular sector to invest in with real estate buyers from China.
Chinese buyers make up the largest portion of international buyers
in the domestic real estate market. Jing Daily provides that in
2015, Chinese home buyers spent an average of $831,800 per home in
the US compared to all other foreign buyers average of $499,600 per
home.
How will this effect Boston? With
an influx of wealthy investors entering the market, housing prices
will steadily increase and see a number of cash buyers. This has
already happened in countries like Australia and Canada, where a
surge of Chinese home buyers has resulted in inflated home prices.
Considering the instability of the Chinese real estate market, it
is likely this movement of Chinese buyers to US cities will
continue in an upward trend.
Property in a city like Boston is
enticing because the prices are much lower than those in China and
the market is more stable in general. Chinese investors see it as a
safe investment. A report from New Asia Society and Rosen
Consulting Group predicts that Chinese investment in domestic real
estate will reach $218 billion from 2016 to 2020. Boston has
already started to respond to the increasing amount of foreign
investment. With the Millennium Tower opening in 2018, new
developments have been enticing foreign buyers with luxury options.
Chinese buyers are especially interested in the special details
that new complexes are now offering such as doormen, private dining
rooms, private gyms, among other amenities.
With San Fran being the most
expensive city in the US to buy a one bedroom, according to
the real estate research website
Zumper, Boston claims the
fifth spot in the nation. This puts Boston real estate in the prime
spot for new buyers. The
average one bedroom costs $2,300 in Boston, compared to the $3,510
average in San Francisco. While Boston still remains high-end it is
more affordable than cities like San Francisco and New York where
housing prices are record high.
This rising interest in investment in Boston
property will only further the growth of the city. New projects
will keep Boston on top as one of the most desirable cities in
America to live in.
Sources: Zumper, Jing Daily, WSJ