From $15 billion last year to $30 billion this year, China’s investments in the US are projected to double this year. Released by research firm Rhodium Group and the National Committee on U.S.-China Relations, the $30 billion mark is right on track for 2016. This large increase is fueled by a slowdown in China’s economy and instability with the yuan, which has Chinese businesses looking elsewhere to invest their capital. The US is considered attractive to these foreign investors, as it is seen as more secure than their economy at home.
The Chinese are increasing their US presence by establishing businesses that employ thousands of workers, acquiring commercial properties in New York or other areas of growth, and by investing in growing industries like tech, entertainment, and energy, reports CNN Money.
Another investment sector that’s seeing a growing influence from Chinese investors is single-family rentals. China overtook Canada as the top country for foreign buyers of US homes in mid-2015 (National Association of Realtors), and this number continues to rise. Tax changes in March 2016 of the Foreign Investment in Real Property Tax Act (FIRPTA) should also aid in increasing foreign capital into the US.
According to New York Times, the home-buying spree from Chinese investors started on the coasts in places like Silicon Valley, California, and Manhattan, New York, but due to high home prices and competition, Chinese investors are now spreading to the middle of the country. These less-competitive areas offer lower home prices and typically higher yields.
Where to Invest
Using data analytics and predictive models, our DataScience team has identified markets across the country that will provide international investors with solid yields. Additionally, the HomeUnion® platform provides investors with detailed information on neighborhoods within those markets, and also drills down to which specific properties will provide investors with the returns they are seeking. For more information on locations, please see our map.