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Xinyuan Real Estate Co., Ltd. Message Board

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  • growth.value growth.value Oct 16, 2012 4:29 PM Flag

    What Is a "Going Private" Transaction?

    @Hmmm, I heard Chinese residents became the number one foreign buyer in the US property market this year. Reason is simple. Many rich guys in China are desperate to invest in assets that are safe and have up potential after Chinese real estate price has stalled for a year. In the last decades, these rich guys experienced huge gain in RE price in China, so they naturally prefer RE to other assets.

    However, the argument that Chinese nationals feel better about buying US properties from Chinese developers is questionable. Most my friends in China naturally prefer properties built by US developers. (Most Chinese still prefer Made in America as long as the price difference is justifiable.) The factor may benefit XIN is that XIN may have good connection with property brokers in China. The information asymmetry is the part that XIN may take advantage of.

    Overall, I still believe Chinese buyers becomes more and more well educated about foreign property investments. Competition will rely more on price, location, and quality rather than brokerage referrals.

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