Dive Brief:
-
Wealthy Chinese investors have bought $22 billion worth of residential real estate in southern California in the past year, helping to revive the housing market there, according to the National Association of Realtors.
-
The influx of money has led to the creation of a cottage industry of realtors, bankers, and lawyers, who are needed to manage the transpacific transactions.
-
Because of a Chinese law that prevents its citizens from transferring more than $50,000 a year out of the country, the complicated real estate transactions can involve multiple investors and funding sources.
Dive Insight:
Realtors told the Los Angeles Times they expect purchases from Chinese investors to taper off if the Chinese government makes good on a threat to issue stricter regulations on money that leaves the country and as the U.S. government considers additional taxes on foreign investors.