For some Chinese investors, the first step to purchasing millions of dollars in property on the other side of the globe is a lot like ordering a new t-shirt online – search and click.

Social media is the catalyst, connecting Chinese buyers and overseas agents. At least one prospective buyer entrusted an agent with $100 million to invest in residential housing. Others bought houses in Houston or plots of land in Colorado, sight unseen, according to real estate agents.

As property prices cool in Hong Kong and Singapore, which have long been magnets for Chinese investment, more money is flowing to real estate markets such as New York, London and Sydney. Chinese have overtaken Russians for the first time as the biggest buyers of apartments in Manhattan, according to real estate brokers.

Chinese buyers invested $13.5 billion in overseas property last year, compared with $6.3 billion a year earlier, according to real estate consultancy Savills.

China’s social media platforms such as QQ, WeChat and Weibo are hugely popular among younger property buyers, many of them 20-something scions of China’s wealthy families. They are driving a new phase of Chinese outbound property investment that is expected to grow 20 percent per year in the coming decade.

“Social media is immediate and familiar to the buyers, it’s a way to connect people without formality and without introduction. And then you have a little connection,” said Joel Goodrich, a San Francisco-based agent who specializes in luxury real estate.

He and his co-worker in New York were referred a Chinese businessman by Juwai.com at the end of last year. The client gave them a budget of $100 million to invest in real estate in New York. They have been communicating over QQ Chat, a popular instant messenger in China run by Tencent, and the buyer has made plans to visit the U.S. city to check out his options.

Juwai.com has also referred clients with budgets of $200 million and A$320 million ($298.93 million) to real estate agents overseas, according to Andrew Taylor, the property website’s Hong Kong-based co-chief executive officer.

China tightly controls foreign currency transactions. Individuals can exchange Chinese yuan for a maximum of $50,000 a year. Chinese companies, however, can buy more U.S. dollars than otherwise allowed by fake invoicing. Many wealthy Chinese have made use of corporate and legal entities to transfer large sums overseas.

SEARCHING FOR INVESTMENTS

Juwai.com’s Taylor said his portal has worked with customers as young as a 20-year-old student who was studying in the United States and looking to buy property there for his family back in China.

Since the website launched 3-1/2 years ago, the types of inquiries have changed. Where once clients were looking only for a place to live in the United States, now it’s often about finding a good investment.

“They’re asking questions about what’s the capital gain, what’s the yield potential, what’s it like living here and what are the taxes,” Taylor said.

Goodrich said 99 percent of his clients buy for investment and they look for yields of around 3 to 4 percent. The top 1 percent are looking for a trophy property.

Although most buyers prefer to check out properties in person before buying, some have agreed to long-distance deals.

Gladys Wang, a Chinese agent based in Houston who has more than 1,400 followers on Weibo, China’s version of Twitter, said she had clients closing deals to buy $300,000 to $400,000 properties without even seeing them.

“Many Chinese are not familiar with Houston, but they learnt more about the city by following my posts on Weibo,” said Wang.

“Nowadays consumers look at reviews before they make a purchase. Social media is good for this. They have more trust in me than those who found me through ads, because they have been following my Weibo, and that speeds up the buying process.”

Excerpts From Reuters.Com