China’s escalating crackdown on capital outflows is sending shudders through property markets around the world.
In London, Chinetranfer their down payments.se citizens who clamored to purchase flats at the city’s tallest apartment tower thee months ago are now struggling to transfer their down payments. In Silicon Valley, Keller Williams Realty says inquires from China have slumped since the start of the year. And in Sydney developers are facing big problems as Chinese buyers pull back, according to consultancy firm Basis Point.
Everything changed as it became more difficult to send money offshore., said Coco Tan, a broker associate at Kelly Williams in Cupertino,California.
less than a month after China announced curbs on overseas payments, anecdotal reports from realtors, homeowners and developers suggest the restrictions are already weighing on the worlds biggest real estate buying spree. While no one expects Chinese demand to disappear anytime soon, the clampdown is deterring first time homebuyers who lack offshore assets and the expertise to skirt capital controls.
It is too difficult, I’m out, said Mr. Zheng, 66, a retired civil servant in Shanghhai who declined to give his first name to avoid attracting regulatory scrutiny He may abandon a 2.4 million yuan{$348,903} home purchase in western Melbourne.even after shelling out 300,000 yuan deposit last August. He’s due to make another big payment next month.
The change spooking Zheng and his compatriots came in a statement from the State Administration of Foreign Exchange on Dec. 31, hours before the reset of Chinese citizens annual foreign currency quotas. among other requirements Safe said all buyers of foreign exchange must now sign a pledge that they won’t use their $50,000 quotas for offshore property investment. Violators will be added to a government watch list, denied access to foreign currency for three years and subject to money laundering investigation, Safe said,