The program would lift the $50,000-a-year limit on withdrawing money for foreign investment, which would ostensibly extend their lead as top foreign buyers.
Likely to launch later this year, the plan, called the Qualified Domestic Individual Investor (QDII2), would allow investors from six cities, including Shanghai, to invest directly in overseas assets like real estate, bonds, and stocks. The program also comes at a time where China is beginning to crack down on people who used illegal means for sending money overseas.
“With QDII2 in mind, within five years we might look back and think of the current levels of Chinese cross-border investment as quaint,” Andrew Taylor, co-CEO of Juwai.com, told the Wall Street Journal.
With a massive supply of existing real estate, light foreign ownership rules and potential for new construction, Taylor expects levels to rise exponentially if the program passes in China.
In addition to the U.S., Australia were the top two targets of Chinese real estate buying overseas.
Top U.S. destinations for Chinese buyers in the first quarter of 2015 were Los Angeles, New York City, Houston, San Francisco and Orlando, based on consumer activity on Juwai.com. The average property price for Chinese buyers on Juwai.com is $1.96 million.
Chinese buyers now lead the world as the top foreign investors in U.S. real estate and that number is expected to grow with a new program that could ease restrictions on capital outflow.