With no sign of a turnaround until the end of President Donald Trump’s current term, Chinese citizens fear that Washington’s tightening of sanctions against China will prompt them to freeze assets in the US and withdraw $27.4bn worth of real estate investments. The property market fell from $30 billion in 2018 to $12 billion in the final quarter of 2020, the lowest level of investment by Chinese citizens in eight years.
A new survey from the National Association of Realtors shows that Chinese buyers are leaving the U.S. real estate market early. Purchases of US real estate by Chinese citizens fell to an eight-year low in the year to November 2020 and could fall to about $12bn, down from $30bn in 2018. Since taking office, the Trump administration has repeatedly imposed sanctions on Chinese companies and Hong Kong officials, including announcing restrictions on Chinese companies linked to the Chinese military, and targeting 11 people, including Hong Kong chief Executive Carrie Lam and Hong Kong police commissioner Deng Bingkeung, and freezing their U.S. assets. The inability to repair a trade dispute with the United States in the short term has prompted Chinese citizens to start selling their homes in the United States to avoid freezing their money.
Taiwan’s economic research department, assistant researcher guo-chen wang said that China and the United States sanctions and other issues in this year will not constitute the economic risks, at the beginning of the new American President took office is bound to the domestic economic recovery as the spindle, the domestic economy in the United States to deal with not too much before in trade, tariffs are expected to be not eliminated after Chinese also won’t increase, and export control of science and technology also is so, don’t reduce also won’t increase. He added that the 2019 CPC Central Economic Work Conference only mentioned real estate in one sentence, while the 2020 conference added it in one paragraph, and listed eight key tasks, believing that the Chinese government will continue to deal with the real estate issue this year.
It is worth noting that the latest news of the trade war between China and the US is still unclear and full of uncertainty. The move comes just four days after the New York Stock Exchange announced it was starting delisting proceedings against three telecom operators, China Mobile, China Telecom and China Unicom. But the latest reports said the New York Stock Exchange issued a brief statement saying that after further consultations with regulators, it had decided not to plan to delist the three Chinese telecom operators. ICE, the PARENT company of the New York Stock Exchange, said it would not press ahead with delisted moves by three Chinese telecoms operators after consulting with regulators over FAQ857 in response to frequently asked questions issued by the US Treasury’s Office of Foreign Asset Management. ICE said the three companies will continue to trade on the New York Stock Exchange. Nyse regulators will continue to evaluate the applicability of Executive Order 13959 to these companies and their continued listing status.
Hang Lung Properties, a Hong Kong developer, said last week that it could not complete a property purchase owned by the US consulate because of its involvement in diplomatic affairs between the US and China. Hang Lung agreed in September to buy the property to house staff at the US consulate, but consular staff indicated in documents that they had received a letter from the land Registry stating that the property was not ordinary real estate. The letter also said that the Chinese government had informed the Hong Kong government that if the U.S. Consulate general intends to rent, buy or sell any real estate in Hong Kong, the U.S. government must submit a written application to China at least 60 days before the transaction, and may not conduct the transaction without the written consent of the Chinese government.
Chinese Foreign Ministry spokesman Wang Wenbin said at a regular December 30 news conference in response to reports that the US had failed to reach a deal to sell the property. “Given the us’s ambassador to the United States to foreign embassies and consulates property management regulations, according to the principle of reciprocity, China urges the U.S. consulate in China including the consulate in Hong Kong, in leasing, purchase, sale or any other means to obtain or to the disposition of property, as well as the implementation of library building, rebuilding and expansion, repair and other projects, also must submit a written application, corresponding to China in advance and provide detailed information, after the Chinese written reply consent, just can deal with concerned formalities.”