NEW YORK–It used to be that Chinese buyers who purchased property in New York did so because the city’s durable real estate market was both a reliable and potentially lucrative investment.
Now, however, affluent Chinese buyers are more likely to seek out Big Apple properties as a way to hang on to their wealth, according to real estate brokers.
Wealth preservation is a factor and “they take a long-range view,” said Kevin Brown of Sotheby’s International Realty.
Brown and partner Nikki Field decided to focus on China when the US real estate market softened in the wake of the financial crisis in 2008. They visit the Chinese mainland a few times each year to host events and meet potential buyers referred to them by HSBC, Citibank and Singapore banks.
One of their first Chinese clients, a mainland woman who now lives in Hong Kong, bought a US$6.5 million apartment at One57, a midtown Manhattan tower that, at 90 stories, will be the city’s tallest residential building upon completion.
“She wasn’t concerned about the rate of return,” Brown said. “She told us she wants her daughter to attend Columbia University and she would like an apartment in midtown Manhattan.
“When we talked about her daughter afterward, I realized she is only two years old.”
According to the National Association of Realtors, China-based clients are now the second-biggest group of foreign buyers of US residential real estate, eclipsed only by Canadians. In 2011, Chinese buyers accounted for 9% of international sales of US homes, up from 5% in 2007.
There are nearly 1 million mainland Chinese with a personal wealth of at least 10 million yuan (US$1.6 million), according to the Hurun Report, a publisher of magazines for China’s wealthy. Cash-rich Chinese buyers typically favor new Manhattan buildings such as the One57, near Central Park, as well as “trophy properties” with a history, such as Walker Tower, an art deco highrise in the trendy downtown neighborhood of Chelsea that was converted into luxury condominiums.
Print ed: 11/12