Overseas properties gearing up for Chinese investors

Overseas property developers and brokers are prepared to sell more homes to Chinese investors, who believe the offshore residential property market offers higher returns and less bubble risks.

A recent report indicated that investors from the Chinese mainland and Hong Kong constitute the second-largest source of cross-border real estate investment in the world after the US.

The report, themed "private wealth around the real estate world" and jointly issued by Savills Plc and Wealth-X, found that in the first 10 months of 2013, $23.7 billion in cross-border investment flowed from the Chinese mainland and Hong Kong.

Money invested directly from Hong Kong is down 42 percent from 2007, but Chinese direct investment is up 1,165 percent during the same period.

"Individual buyers sought established, international markets in jurisdictions which have cultural ties with China or with a large Chinese migrant population. Hong Kong, Macao and Singapore have been followed by other top-tier global cities with Chinese diasporas such as Vancouver, London and Los Angeles," said James Macdonald, head of Savills China research.

A rising number of offshore property developers have apparently noticed this trend, and they have started to market local properties to Chinese investors, who have very limited investment choices at home, analysts said.

A luxury residential project at Singapore's Marina Bay financial center is one of the latest examples.

The project is called Marina Bay Suites, and half of its units have been sold to overseas buyers, 30 percent of whom are Chinese buyers, according to Thomas Tan, director of marketing, residential, Raffles Quay Asset Management Pte Ltd.

Seventeen of the 221 units are still looking for buyers, Tan added.

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