The biggest foreign buyers of New York real estate were once the Chinese. Not anymore. There has been a dramatic drop in purchases in recent years, in part, because of rising tensions between the U.S. and China. This along with other factors is helping to push prices lower in New York’s once hot market. CGTN’s Karina Huber has more.

In 2016, Chinese investment in commercial real estate in New York topped $8.5 billion. The Chinese were the city’s biggest foreign investors.

“You have to know that China was a very dynamic buyer and an aggressive player in the real estate market in New York, and in this country, but they’re out,” said Donna Olshan, Founder of Olshan Realty.

By 2018, Chinese commercial investment in New York properties had fallen to less than $350 million.

According to Real Capital Analytics the drop began in 2017 before falling dramatically in 2018.

The initial drop coincided with tighter controls on Chinese capital invested abroad. But Olshan said geopolitics have also played a role.

“The elephant in the room, as we say, is we have this big trade negotiation between the United States and China and it continues to bounce back and forth,” said Olshan.

The chill among Chinese buyers can also be felt in the U.S.’s residential real estate market.

According to Chinese foreign property sales site, Juwai.com, U.S. purchases were down four percent in 2018. Enquiries were down more than 27 percent in the first quarter of 2019.

The drop in Chinese buyers is just one factor that is helping to push property prices lower in New York. Changes to U.S. property tax laws and an oversupply of luxury properties are also weighing on the market.

“It’s a great time for a buyer here now. But unfortunately, the Chinese can’t buy here now. Because they’re watching their outflows of capital and the political climate is just not for them,” said Olshan.