Chinese Investment in Real Estate to grow further
Savills estimate that this level has already been surpassed in 2013, because the Chinese made several high profile investments in important city locations. The international property specialists predict that Chinese investment in overseas real estate is going to grow for many years to come, as the superpower is trying to “integrate with the rest of the world”.
The Spanish property market could certainly do with a serious spending spree by a superpower like China. Although Murcia is currently seeing a mini-boom in residential property investment thanks to the construction of the Paramount Studio theme park and much improved infrastructure, the rest of Spain is doing less well. The surplus of empty new homes at the Costas will haunt the property market for many years to come, it seems. So will Marbella see more Chinese money being spent on luxury villa developments?
“Chinese investors have now moved onto other markets where, although they account for a relatively small portion of buyers, their numbers are rising rapidly,” said James Macdonald, Savills’ Head of Savills Research, China. “Chinese nationals are seeking capital security, access to education and healthcare, permanent residency and citizenship.”
He went on to say that the fall in property prices in the wake of the economic crisis has made residential property investment far more affordable and opened up far more investment opportunities for Chinese buyers, who are no longer subject to the type of stringent capital controls they once were. Now that investing overseas is becoming easier, many Chinese are opting for investment in real estate, which has traditionally been their preferred investment product, according to Savills’ report.
And who could blame them if they purchased half of Marbella’s available housing stock? With lovely luxury apartments in Elviria on the market for less than EUR 250,000 and 3-bed villas with views over the fairways in Guadalmina coming on the market for EUR 495,000 or less, is it any wonder Chinese investors are tempted to make a purchase?
The Malaga province is still among the favourite investment destinations for many buyers hoping to find real estate opportunities overseas. There’s just so much to do in Marbella and availability of luxury property is less restricted than it is on the Balearic Island of Mallorca for example, a market foreign investors see as one of the safest in Spain. In many ways, Mallorca and Ibiza have shown the way to developers. Not middle-of-the-road type design or cheap and cheerful construction values have won the day – Mallorca’s property market suffered far less following the collapse of Spain’s property market because here high construction and design values had ensured properties remained desirable. Coupled with restricted availability of luxury homes and a continued high demand from British, Scandinavian and German buyers, Mallorca as a whole has set its sights on becoming a 5-star island catering for holidaymakers and semi-permanent residents with plenty of money.
Some investors already feel that the growth in the four- and five-star hotel sector on the island is reason enough to dip a toe in the residential property market. If Mallorca’s example is anything to go by, Marbella with its prestigious Golden Mile and Sierra Blanca addresses should do well in the near future. Here private Chinese investors looking for a luxury home within easy travelling distance of international schools, amenities and the beach can buy a 2-bed property for around EUR 630,000 upwards.