Chinese outbound property investment slides 63% in 2018

Mainland Chinese poured just USD15.7 billion into real estate overseas in 2018, a 63-percent slide from 2017 and the lowest figure since 2014, according to Cushman & Wakefield via CNBC.

Around 84 percent of respondents to the consultancy’s 2019 China Outbound Real Estate Investor Intention Survey claimed they had reduced funds for foreign real estate acquisitions last year or held to the same levels as 2017.

Around 51 mainland Chinese investors with a combined offshore capital of CNY280 billion (USD41.81 billion) responded to the survey.

Sixty-five percent of respondents found their enthusiasm for overseas properties “significantly or severely” curbed by a nationwide clampdown on capital flight last year.

While capital flight controls have been in place for a few years now, the figure is a significant increase from the 50 percent who held the same sentiment in 2017.

Sixty percent of respondents did not believe policy restrictions would let up in 2019. Majority of respondents also cited the increasing difficulty to take out loans for investments, with just 18 percent holding out hope for an improvement in the lending environment this year.

“We expect that Chinese banks’ real estate lending may remain tight for much of the year ahead, creating an environment that will clearly continue to restrict deployment of mainland Chinese capital in general, irrespective of geographic location,” James Shepherd, Cushman & Wakefield’s managing director for Greater China Research, said in a press statement.