Real Estate News Published July 26, 2012 By Aaron Schoenberger
Chinese Real Estate Buyers, Feng Shui & Lucky Numbers

Chinese investors have spent over $10 billion on residential real estate in the United States in the past two years, and invested $1.71 billion in commercial real estate in 2011 alone. This large influx of Chinese buyers makes it important for real estate professionals to understand their wants and needs.

First, let's look at why U.S. investments are so appealing to Chinese investors. If one word comes to mind, it's value.

Real estate is very expensive in China, and high prices are the driving force behind investments in the United States. “For the price of a 500-square-foot one-bedroom apartment in Hong Kong, around $2 to $3 million US, one can buy a 5,000 square foot house on a half-acre lot in most parts of the U.S.,” said Robert Hsu, editor of InvestorPlace's China Strategy column, in a recent article.

In the article, titled Chinese Investments in U.S. Real Estate, Mr. Hsu shows Chinese buyers are purchasing everything from stereotypical homes in suburban areas to lavish estates. “My friends in China often ask me about a $34.5 million Beverly Hills mansion that was recently sold to a mainland Chinese couple. In New York City, a $50 million apartment in the new One57 condominium tower was also sold to mainland Chinese buyers,” he stated.

Whether purchasing a small house in Phoenix, Arizona or a full-floor condo in New York City, many Chinese buyers make decisions with numbers in mind. To accommodate them, developers are actually planning projects based on ancient Chinese philosophies.

During the planning of One57, developers decided to put the largest, most luxurious units on the 80th through 88th floors. Since the number eight is believed to be a lucky number associated with prosperity and wealth, it should be no surprise to hear that many of the units were purchased by Chinese buyers.

Aside from lucky numbers, feng shui is also very important.

Originating in China thousands of years ago, feng shui is a system of geomancy that uses the laws of Heaven and Earth to receive positive qi (or chi). Following feng shui principles and building positive energy is believed to improve one's quality of life.

When it comes to real estate, feng shui applies to everything from putting toilet seats down to furniture positioning to color schemes. Surprisingly, implementing feng shui concepts can actually boost home value and decrease time-on-market, while on the flip side, ignoring feng shui can adversely affect sales. This is especially true in areas with a large number of Chinese buyers, such as Los Angeles, New York City, and Miami.

A study released in 2007 by the Chinese Science Research Institute found that 21 percent of the Chinese public say they believe in feng shui. This means over one-fifth of Chinese buyers in the United States will likely make decisions with feng shui in mind, which adds up to billions of dollars in investments.

In the end, marketing is all about understanding target markets, and real estate professionals in the U.S. are beginning to get a feel for Chinese buyers. However, there's still a long road ahead.

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About Author

Aaron Schoenberger is a marketing executive, entrepreneur, and real estate investor with a passion for business. He writes about a wide variety of topics ranging from real estate marketing to fixing and flipping homes, and has had his work published on numerous industry-related websites. Mr. Schoenberger is a thought leader and is viewed as a authority when it comes to online public relations, social media, and search engine optimization (SEO).


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