Fancy a second home abroad? So do many Chinese
Lure of gaining residency in a foreign country is also prompting many to seek offshore property
When Beijing businessman Michael Gao thinks about buying a second home somewhere to get away from the heavy smog in the capital, his choices are neither the tropical resort island of Hainan nor the southwestern province of Yunnan, with its pleasant weather all year round.
He sets his sights on Barcelona, the second-biggest city in Spain, more than 8,000 kilometres away from Beijing.
"Can you imagine, Hainan's property prices are much more expensive than Spain's," Gao said. Prices in Sanya city, Hainan, have climbed to nearly 30,000 yuan (HK$37,500) per square metre, he said, while flats in one Barcelona project are going for €2,500 (HK$26,640) per square metre.
To buy a home in an overseas country has become the goal of an increasing number of people on the mainland.
At the Beijing Spring Real Estate Trade Fair last week, overseas projects dominated the exhibition halls. About 300 residential and commercial real estate projects from Canada, the United States, Australia, Europe and Southeast Asian countries were being promoted.
Chinese homebuyers are attracted not only by the better living conditions abroad but also the social welfare benefits, in addition to the potential investment value of a home and the convenience buying one offers as a way to obtain residency in a developed country.
For Gao, the residential project in Spain is good value for money.
"I heard the Spanish property market is at its lowest point in 25 years. It's less likely to go down further," he said.
"Originally I was thinking of buying a bigger unit in downtown Beijing, yet it takes about 12 million yuan to get a four-bedroom flat here. With this money, I can buy a villa in Spain or some other European country."
Immigration is part of the long-term plans for Howard Liu, who is a manager at a real estate development company based in Beijing.
Although his son is only five years old this year, Liu has already been searching for a place in either the US or Canada for his son to live in when he goes to secondary school.
"It's not too early [to buy fixed assets overseas]. Now the yuan has been depreciating, and the risk of holding assets in China is turning bigger. So the timing is right for me," said Liu, who has a budget of five million yuan for his first flat in a foreign country.
"Some of my friends have similar thinking to mine. We would work in Beijing, and our children would continue studying here for the next few years. But we can get the green card first to travel abroad conveniently."
Canada, Australia and Europe are the most sought-after places by Chinese considering buying a home overseas. Their average budget is about two million yuan.
"Our customers extend from the richest people in China to the middle class," said Tommy Chen Hongtao, general manager of Ruihong Investment & Consulting, a company that sells property projects in 16 countries to Chinese customers.
It was the sixth year his company was taking part in the twice-yearly real estate trade fair in Beijing. Chen said the number of people interested in his firm's projects has risen significantly.
"Six years ago, people just came to our counter, took a leaflet and asked some general questions. Now many are well prepared when they come to us and ask very specific questions. We got 13 customers who signed contracts with us at the four-day autumn fair in September. This spring, we are aiming to get 30 contracts."
Chen said immigration policy is the top concern for Chinese people considering buying a home overseas.
Portugal has been the most popular choice since it announced a new immigration policy, under which Chinese citizens can obtain permanent residency by investing €500,000 in the country.
By November, 248 Chinese had managed to obtain residency through investing in real estate projects in Portugal.
"In China, people are getting rich, but their concern about air pollution is increasing, and the social pressure in big cities is great," Chen said.
"We are sure more and more people would like to move to other countries for a breath of fresh air."