The governor of Florida, Ron DeSantis, has warned that China is buying America’s real estate and farmland as hundreds of Chinese firms have bought up billions of dollars worth of American farmland and real estate over the last years and have vowed to tackle the practice in Florida, calling it a “huge problem” during an interview with Fox News’ Laura Ingraham last Friday.
DeSantis’ warnings come at a time of deep tensions and suspicion between the United States and China. Just a few days ago, American officials expressed their concerns that China might try to move against Taiwan over the next few months. On Monday, CNN revealed the FBI had determined that Chinese-made Huawei equipment atop cell towers in the Midwest was capable of disrupting American nuclear communications.
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During his interview with Ingraham, DeSantis said he would not allow “undue influence from rogue actors” in his state. The governor’s comments referred to the latest report by the National Association of Realtors, which showed that Chinese companies bought $6.1 Billion of American real estate between April 2021-March 2022. DeSantis said the main concern over these transactions was that “these companies have ties to the CCP, and it’s not always apparent on the face of whatever a company is doing.”
DeSantis’ remarks over the purchase of millions of acres of American land by Chinese companies came just a few weeks after it was reported the Chinese food manufacturer Fufeng Group bought up 300 acres of farmland 20 minutes from the Grand Forks Air Base in North Dakota.
China is buying America’s real estate, spending $6.1 billion in 2021-2022
Despite only 6% of all foreign buyers, Chinese companies and firms are the number one spender in the American Real Estate market, buying up to $6.1 billion of real estate in one year. Canada, which represents 11% of all foreign buyers, is behind China, spending $5.5 billion on real estate.
According to the NAR report, most foreign buyers (24%) decided to purchase property in Florida, followed by California (11%) and Texas (8%). However, California, not Florida, is the leading destination of Chinese buyers, as 31% of China’s purchases were done in the Golden State, compared to 7% of the assets they made in Florida.
While California is the main target for Chinese buyers, New York is the second-biggest destination for Chinese purchases, as 10% of them bought properties in the state. As expected, in both of these states, buyers from Asia/Oceania represent the most significant share of foreign buyers of real estate. On the other hand, most of Florida’s foreign buyers come from Latin America and North America.
Most of the homes bought by Chinese firms and investors are dedicated for primary residency (52%), a quarter of them decided to purchase property for residential rental purposes, and a substantial minority (8%) bought properties for student use.
China has increased its hold of American farmlands more than tenfold in ten years.
Chinese firms and investors have not only bought up residential homes in California and New York but also acquired a substantial amount of farmland in the United States. According to the 2020 United States Department of Agriculture (USDA) report, 82 Chinese investors own 194,176 acres of American farmland valued at 1.8 billion dollars.
While that number remains low compared to buyers from other countries, for example, Canadian investors will own more than 9 million acres of land in 2020, the upward trend of Chinese purchases is what is creating cause for concern; according to the USDA, Chinese agricultural investment abroad grew more than tenfold between 2009 and 2016.
The expansion of Chinese agricultural overseas investment is evident in the amount of American farmland. Chinese firms own now compared to 2010. In just ten years, China went from owning just 13,720 acres of land with a value of $81 million to more than 190,000 acres of land valued at 1.8 billion dollars that Chinese firms owned in 2020.
Interestingly, while Chinese buyers have significantly expanded their operations in the U.S, the number of investors has not increased at the same level. In 2010 67 investors owned less than 14,000 acres of land (208.9 acres per investor); in 2020, 82 investors held more than 190,000 acres of land (2,368 acres per investor.) Meaning that despite China increasing their land acquisitions in America by more than tenfold, they only added a net total of 15 new investors between those ten years.
Daniel is a Political Science and Economics student from the University of South Florida. He worked as a congressional intern to Rep. Gus Bilirakis (FL-12) from January to May 2020. He also is the head of international analysis at Politiks // Daniel es un estudiante de Cs Políticas y Economía en la Universidad del Sur de la Florida. Trabajo como pasante legislativo para el Representate Gus Bilirakis (FL-12) desde enero hasta mayo del 2020. Daniel también es el jefe de análisis internacional de Politiks.