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.