Chinese Now the Leading Foreign Purchaser of U.S. Real Estate

Forbes has confirmed what many already suspected: the Chinese are buying up more U.S. real estate than anyone else. And they're not buying junk either. Wealthy Chinese investors are now the most prolific purchasers of luxury high-end real estate in New York City.

It's estimated that nearly a third of all the apartments along Central Park, between 5th Avenue and Park Avenue are currently vacant and owned by foreign investors. The majority of these are Chinese.

In 2013, foreign real estate transactions in the United States totaled more than 68 billion dollars. Of that 68 billion, the Chinese accounted for 12.8 billion worth of U.S. property sales. And it's growing.

A number of analysts believe that China is currently in the midst of a housing bubble that could be on the brink of bursting.

CBS' 60 Minutes did a story last year that showed that the country has entire cities in various stages of construction and completion with no one to live in them. In 2011, it was estimated that there were more than 64 million vacant apartments in the country.

That same year, a law was passed in China which limited Beijing housing ownership to two per family in the city, and imposed a ban on sales to anyone who had not resided in the city for at least 5 years. This caused a drop in domestic sales, but there is no such stipulation for foreign purchases.

Of course, this has led the wealthier and more savvy Chinese investors to seek investment opportunities abroad, with many eyeing the U.S. as the juiciest.

And they're not just looking at New York. Most of the Chinese real estate purchases are occurring in California. In February, one of China's largest real estate developers, the Greenland Group purchased a 6-acre lot in downtown Los Angeles for 1.5 billion. It will be the largest mixed-use development in the state. 

The Baccarat Hotel

It would be cause for alarm if China was only buying a high quantity of properties. And they are. But what is more alarming is that they are buying the best properties available.

And many of these Chinese investors are so eager to buy they will purchase a new property sight unseen. A client of Douglas Elliman bought two apartments inside the Baccarat Hotel and Residences on West 53rd st for $13 million each, without ever setting foot inside the building.