Karen Xu, a Shanghai resident who was in the market for a Miami one-bedroom condominium in the price range of $500,000 to $750,000 said that with China's current economic status, she has now changed her mind in investing in the US right now.
"I don't think I'll be investing in the US right now. Maybe I'll wait another five years, or invest in China," Xu from an investment consulting firm said.
According to the Wall Street Journal, Chinese buyers are no longer considered the marginal buyers of high-end real estate in the United States. In the last five years, Chinese nationals beat the Canadian snowbirds and became the top buyers of US homes. The recent annual data shows that Chinese buyers scoop up everything from $500,000 condos in New Jersey to $3 million vacation homes in California to $13 million condos in Manhattan.
However, in the recent weeks, news broke out that Chinese buyers started to withdraw from investing real estate properties in the country.
According to the report, China's stock market started to sell off which resulted to slow economic growth, currency devaluation, and tightened restrictions on their capital outflows. These factors affect Chinese buyers' capability to continually purchase and invest in the US real estate market.
"We are ready to embrace a winter for Chinese buyers in the next one year, two years," Daniel Chang, a New York City-based broker at Sotheby's International Realty, said.
Realtor Christina Shaw from Re/Max Fine Homes in California also said that her client is planning to reduce his budget by one-third to purchase two houses in the area.
President and Chief operation officer of Tri Pointe Group, Tom Mitchell said that Shanghai's Composite Index is currently down to 38 percent. Thus, interest from Chinese buyers also deteriorates after the sharp fall of their stock market.