When buying a home is treated as a national security threat

Real Estate News

More than three dozen states have enacted or are considering similar laws restricting land purchases by Chinese citizens and companies.

A Florida law, which went into effect in July, bars Chinese entities from buying agricultural land and effectively prohibits most Chinese individuals without a green card from purchasing residential property. AP

By Amy Qin and Patricia Mazzei, New York Times Service

May 6, 2024 | 4:28 PM

MIAMI — After years of living in dorms and subpar apartments, Lisa Li could not wait to close on her new home.

The one-bedroom condo in Miami’s financial district had a view of the river, was in a safe neighborhood, and, Li heard, had neighbors who were much like her — less party, more chill. So Li, 28, who came to the United States 11 years ago as a college student from China, put in an offer, had her bid accepted, and began ordering furniture.

Then things took a sharp turn. At the last minute, the title company raised concerns about a small US Coast Guard outpost near South Beach a few miles away. Her purchase, the company said, might run afoul of a new Florida law that prohibits many Chinese citizens from buying property in the state, especially near military installations, airports, or refineries.

Under the law, Li could face prison time, and the sellers and real estate agents could be held liable. The deal collapsed.

“The whole experience was very hurtful and tiring,” Li said in a recent interview at a café in Miami, where she is still renting. “I just feel that, as someone who has lived and worked in this country for many years, and as a legal taxpayer, at the very least I should have the ability to buy a home that I can live in.”

More than three dozen states have enacted or are considering similar laws restricting land purchases by Chinese citizens and companies, arguing that such transactions are a growing threat to national security and that the federal government has failed to stop Chinese Communist Party influence in America.

Florida’s law, which went into effect in July, is among the furthest reaching. In addition to barring Chinese entities from buying agricultural land, it effectively prohibits most Chinese individuals without a green card from purchasing residential property. Governor Ron DeSantis signed the measure just before launching his Republican presidential campaign, warning voters that China represented the biggest threat to the United States.

“Today, Florida makes it very clear: We don’t want the CCP in the Sunshine State,” DeSantis said last year.

In more than a dozen interviews, Chinese residents in Florida voiced frustrations about being cut off from the ultimate American dream. Other residents of Chinese descent said they faced discrimination as they tried to buy a home. Some said they lived in fear over whether they may have inadvertently violated the law.

Civil rights and Asian American groups are unaware of anyone being charged with violating the law. But some people of Chinese descent said they feel the anti-China sentiment intensifying. The law is currently being challenged in federal court.

“I never felt any discrimination here before this law,” said Jin Bian, a Chinese software developer who works in Tampa and is among those now barred from buying property. “But now I’m wondering if I need to leave Florida.”

The law has also had an apparent chilling effect on the real estate industry, an important part of the state’s economy. Developers often rely on Chinese investors to help build projects in Florida, and the law appears to have barred such financing, prompting pushback from a prominent real estate lobbying group.

The Chinese government has a record of using economic coercion and espionage to further its geopolitical goals and, in recent years, both the United States and China have stepped up efforts to advance their spying capabilities around the world.

The law was part of a broader package passed by the Florida Legislature last spring that included a bill restricting the state’s public universities and colleges from offering research positions to students from China and other countries. That law is also being challenged in court.

“The deeper that you look under the hood, the deeper that you see China has been clandestinely going after land grabs in the United States,” said state Rep. David Borrero, a Republican from the Miami area who was one of the sponsors of the land law. “We can’t just have that in our backyard.”

Borrero disagreed with critics who said the property bill was discriminatory. “Our national security interests come first,” he said.

State lawmakers have been especially worried about Chinese investment in agricultural land and territory near military installations, fearing that China could throttle America’s food supply or use the land as a spy post. Chinese interests own less than 1% of foreign-held agricultural land in the United States, according to the US Department of Agriculture.

National security experts said the specific threat posed by Chinese people owning homes has not been clearly articulated.

Holden Triplett, a former FBI counterintelligence official who led the bureau’s offices in China, said Chinese citizens are more likely to have family ties to China that could be weaponized by state security agencies there. But, he said, categorical bans could further alienate a Chinese diaspora community that could be of particular help to the United States in the event of a conflict with China.

“We need to be careful about these blunt instrument laws,” said Triplett, who left the FBI in 2020 and cofounded Trenchcoat Advisors, a risk management consultancy. “Let’s do the work to find out what’s happening and to see if there is another way we can address this problem.”

Civil rights groups and residents have challenged the Florida law in federal court on grounds that it violates the Equal Protection Clause and the Fair Housing Act, and that it undercuts the federal government powers on foreign affairs.

“There’s no evidence that Chinese homeownership poses harm to national security,” said Ashley Gorski, senior staff attorney with the American Civil Liberties Union, one of several groups that brought the suit.

Mae Ngai, a professor of history and Asian American Studies at Columbia University, said the Florida law recalled the alien land laws from the early 20th century, which effectively prohibited Asian immigrants from buying farmland and, in some cases, homes in many states.

“They saw Asians as an alien invasion that was going to take over America,” Ngai said.

After the bill was introduced last spring, the Chinese community in Florida began frantically organizing rallies and door-knocking sessions.

In Texas, opposition from the Asian American community, including a former Republican lawmaker of Chinese descent, helped roll back some provisions in a similar bill. But in Florida, the Chinese community is just 0.6% of the population. Many are first-generation immigrants who moved to the state to study or work at universities. And there are very few Asian American politicians in the Legislature.

The Florida activists’ dissent barely registered.

Lobbyists for the prominent hedge fund Citadel, which moved to Miami from Chicago in 2022 and employs a large number of Chinese citizens, were more effective and managed to secure an exemption for Chinese people on valid work visas to buy one primary residence as long as the property is smaller than 2 acres and not within 5 miles of a military installation.

But most of the initially proposed restrictions were kept in place, and the impact of the law was felt almost immediately.

Evelyn Yang, a real estate agent in Palm Beach Gardens, said that shortly after the law went into effect, she repeatedly made inquiries about an apartment in Miami on behalf of a Chinese client who had permanent residency. She didn’t hear back from the seller’s agent for days, she said.

“When they finally returned my calls, they just said, ‘Can your buyer buy? Can’t Chinese people not buy right now?’” Yang recalled. “They see that our names are Chinese and assume that we can’t buy.”