Looking abroad for a new home
Updated: 2013-04-08 09:54
By Wang Ying and Hu Yuanyuan (China Daily)
A Chinese woman watching a presentation of an overseas project at a cocktail party in central London. It costs buyers an average of 20 years to get their investment back from rental incomes in London. The biggest advantage about having a property investment in the UK is that there is no capital gains tax for sales by the non-domiciled. In contrast, China has just introduced a new policy of levying a 20 percent income tax on home sales. [Provided to China Daily]
Chinese lured by comparatively cheaper houses elsewhere, report Wang Ying and Hu Yuanyuan
Properties in the former US industrial city Detroit started to fall to as low as $100, attracting Chinese investors who have found their investments in the Chinese property market becoming harder under the central government's tightening policies.
As real estate hits rock bottom in Detroit, Chinese investors are planning to purchase properties there, the People's Daily reported.
There are more than a dozen properties priced lower than $100, with some extreme cases on offer for $1.
Some Chinese investors are linking up to buy several properties there. Given that some wealthy Chinese are happy to spend $1,100 on a single pair of designer shoes, the opportunity of buying two Detroit properties with change to spare is not being ignored, the China Central Television reported.
The Chinese property market is experiencing a new round of tightening. The central government announced on March 1 a levy of a 20 percent tax on gains on pre-owned house sales.
Experts suggest homebuyers should be cautious before undertaking an overseas shopping spree because there is "no such thing as a free lunch".
"For instance, Detroit is extremely cold in winter with the lowest temperature reaching minus 30 degrees Celsius and the broken economy means there is a high rate of unemployment and crime," said Tian Xue, an associate director and head of international project marketing at Knight Frank China.
It may be true that some Chinese buyers are zeroing in on the Detroit property market but James Macdonald, head of Savills research team in China, is skeptical about the magnitude of the trend.