I’m not saying the US isn’t seeing an uptick in buyers from China, especially housing markets such as Manhattan. After all, there is a global trend  where money is chasing stability and safety. US real estate has been a key beneficiary of this trend.
However it is important to realize that there is no US data from independent sources that links overseas nationalities with residential real estate purchases. Why?…because of long time concerns in the US about fair housing laws  and by extension, the gray area of tracking nationalities to housing purchases although it is the norm outside the US.
When any housing trend is discussed, it is important to understand where the source of the trend came from. I’d really like housing market followers to appreciate that the trend analysis on the foreign buyer subject bantered in the media as of late is literally based on nothing. There has been an outpouring of coverage of the topic over the past few months, but the sourcing is only from real estate brokerage anecdotes because that is all there is for reporters to work with. I was interviewed for some of the following articles but disagreed with the general story premise, and I assume that is why my view wasn’t inserted.
Whichever stance you take on this particular trend – that Russians used to dominate the Manhattan housing market and how the Chinese have taken their place at the top – there really is no wrong answer, because there are no facts. All sourcing on the topic to make that point are from real estate agents referring to their opinion, often based on their past few transactions.
I first noticed this new new storyline when Russia invaded Crimea . Would the Russian position as the number 1 foreign buyer of real estate in Manhattan now go away? The brokerage community, or at least a couple of real estate agents claimed this to be the case.
I have no evidence to the contrary even though there are huge capital outflows from Russia that began with the Russian invasion of Crimea . In my view, the real estate agents were confused by the high profile sales by Russian buyers (think of Russian Oligarch buying 15 Central Park west for $88M ) and perhaps has some direct feedback in some of their own transactions. However I don’t think Russians were ever the top homebuyers in Manhattan, just the highest profile.
If we have learned anything from the current Manhattan new development boom, it is the fact that high profile, high end transactions are not a proxy for the balance of the market much like a handful of high profile Russian purchases are not a proxy for some sort of Russian real estate dominance.
Manhattan Real Estate Feels a Russian Chill [NYTimes ]
Now that the Russians are “out” (see previous) of the top spot, that must mean that the Chinese are “in.” Check out the headlines  to this storyline although much of these articles build on the Reuters piece (linked below) which is based on real estate agent anecdotes. A slew of brokerage PR driven stories on the Chinese are now dominating the real estate headlines in New York City.
Perhaps this uptick as something to do with recent closings at well published Chinese buyer favorites like One57  and perhaps the fact that China is poised to become the world’s number 1 economy .
U.S.CHINA’S RICH BECOME BIGGEST FOREIGN APARTMENT-BUYERS IN MANHATTAN [Al Jazeera ]
Who are the dominating the foreign buyers of Manhattan real estate?
Anecdotally I think it remains Canadians but is dominated by Europe (UK, France, Germany, Italy, Spain, Ireland, etc combined) because they are still the largest tourism group. Brazil doesn’t get enough respect since they are the 3rd highest source of tourism to NYC. This list is 2 years old but I doubt China has passed Europe or even come close but this is, shall I say, “anecdotal.”
From NYC & CO ., here are New York City’s top international sources (2012 figures):
- Canada 1,063,000
- United Kingdom 1,033,000
- Brazil 806,000
- France 667,000
- Germany 605,000
- Australia 595,000
- PR China (excl. Hong Kong) 541,000
- All Middle East (incl. Israel) 478,000
- Italy 449,000
- Mexico 387,000
- Eastern Europe 384,0000
- Spain 380,000
- Japan 328,000
- South Korea 281,000
- Argentina 272,000
- Ireland 224,000
- India 215,000
- Israel 203,000
- Netherlands 203,000
- Sweden 190,000