"The domestic Chinese market is very unstable, full of bubbles and depends on government policy," says Cathy Zhang, senior sales consultant at Ausunland Group.
Prices for prime residential real estate in cities such as Los Angeles and Miami are roughly 25 percent lower than in Shanghai.
Government restrictions, worsening pollution and decrepit health and social services have also led many Chinese to buy property in more developed countries they may wish to eventually emigrate to. Add to that the anxiety generated by the anti-corruption campaign launched by President Xi Jinping two years ago.
Although few in the industry will openly discuss it, some acknowledge privately that fear among Chinese officials and business people has been a big factor in the surge of investment into western real estate. The Chinese government has stepped up efforts to repatriate corrupt officials and recover offshore assets, including luxury foreign properties.
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"The ongoing purge and the fear of losing everything if you are caught up in an anti-corruption investigation or a political fight has convinced many in China to diversify to places with clear and stable legal and political environments," says one figure at a large property advisory company.
Capital controls restrict Chinese residents from exchanging more than $50,000 in foreign currency each year, which would make it almost impossible for a Chinese person to buy a prime residential property abroad.
This means effectively that all property purchases by Chinese nationals overseas are technically illegal.
Questions over the provenance of much of the Chinese money streaming into cities such as New York, London and Sydney will also add to growing resentment among locals who feel they are being priced out of the market.
Analysts expect the backlash to spread as Chinese investment continues to rise and politicians face increasing pressure to act.
The Australian government has proposed "application fees" of A$10,000 (US$7,800) for every A$1 million that foreign buyers spend on Australian property.
It has also pledged to enforce an existing law that prohibits non-residents from buying existing — rather than newly built — housing. Offenders could be fined up to 25 percent of the value of the property and forced to sell it.
The UK government has made a series of tax changes in the past three years aimed at discouraging wealthy foreign buyers from the London housing market. The crackdown focused particularly on homes bought using offshore companies, which make it hard to trace a property's ownership.