Chinese-owned land in the US is legal under federal law, but a Chinese buyer moves through three separate filters before a deal closes: a national security review by a federal interagency committee, a USDA disclosure requirement for farmland, and, increasingly, state statutes that restrict or forbid the purchase outright. As of December 31, 2024, Chinese primary-investor filers reported holding 247,659 acres of U.S. agricultural land, a small share of the roughly 46 million acres held by all foreign investors.1Farm Service Agency. Foreign Holdings of U.S. Agricultural Land Through December 31, 2024
How Much Land Chinese Investors Actually Hold
Foreign investors together held an interest in more than 46 million acres of U.S. agricultural land at the end of 2024, about 3.6 percent of privately held agricultural land nationwide.1Farm Service Agency. Foreign Holdings of U.S. Agricultural Land Through December 31, 2024 That total is up from about 45 million acres a year earlier.2Farm Service Agency. Foreign Holdings of U.S. Agricultural Land Through December 31, 2023 Most of that acreage traces back to investors from Canada, Europe, and other allied countries.
Chinese holdings, at 247,659 acres, are a small piece of the whole and have actually declined from earlier reporting years. The bulk is forestland and cropland. Public and legislative concern has focused less on the aggregate number than on individual acquisitions near military bases and other sensitive sites.
Federal National Security Review Through CFIUS
The Committee on Foreign Investment in the United States (CFIUS) is an interagency body at the Treasury Department that screens certain foreign real estate purchases for national security risk. Where CFIUS identifies concerns it can negotiate mitigation conditions or refer the deal to the President, who can block it.3U.S. Department of the Treasury. CFIUS Overview The committee’s real estate jurisdiction comes from the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA) and was refined by a 2022 executive order.4U.S. Department of the Treasury. CFIUS Laws and Guidance
CFIUS does not review every foreign purchase. Its real estate reach is tied to proximity to about 247 listed military installations and government sites, grouped into four categories.5eCFR. Appendix A to Part 802 – List of Military Installations Depending on the category, jurisdiction stretches from one mile out to 100 miles from the installation boundary.6Federal Register. Definition of Military Installation and the List of Military Installations in the Regulations
A deal falls in scope when the foreign buyer would gain at least three of four core property rights: physical access, the right to exclude others, the right to develop, or the right to build permanent structures.7eCFR. 31 CFR Part 802 – Regulations Pertaining to Certain Transactions by Foreign Persons Involving Real Estate in the United States Purchases in urbanized areas are generally exempt, which pushes the committee’s attention toward rural and semi-rural land near sensitive sites.
USDA Disclosure Under AFIDA
The Agricultural Foreign Investment Disclosure Act (AFIDA) takes a different tack. It does not block purchases. It requires any foreign person who acquires, sells, or holds an interest in U.S. agricultural land to report the transaction to the USDA within 90 days.8eCFR. 7 CFR Part 781 – Disclosure of Foreign Investment in Agricultural Land Agricultural land is defined broadly and covers farmland, ranchland, forestland, and timber tracts.
The penalty for failing to file, or filing inaccurate information, can reach 25 percent of the property’s fair market value. On a serious acquisition that is not a paperwork fine, it is a material financial risk. Critics have argued that compliance is uneven because USDA relies on voluntary reporting and has limited audit capacity. Proposals in Congress would tighten reporting when land is sold to individuals from China, Russia, North Korea, or Iran, but none of those broader reforms had become law as of early 2026.
State Restrictions on Foreign Ownership
Because federal law does not ban foreign purchases outright, states have moved to fill the gap. At least 28 states had enacted some form of foreign ownership restriction by 2025, most of them passed since 2023. During the 2025 legislative session alone, bills were introduced or advanced in 38 states.
The most common design targets agricultural purchases by people or entities tied to designated “foreign adversary” countries, usually China, Russia, Iran, and North Korea. Some laws extend to land near military installations, critical infrastructure, or government facilities. Beyond that, they diverge:
- Outright bans that prohibit certain non-citizens from designated countries from acquiring specified property.
- Registration and reporting duties that layer state disclosure on top of AFIDA.
- Proximity rules that forbid purchases within a set distance of military bases, energy facilities, or water infrastructure.
- Divestiture mandates that require sale within a fixed period after a violation, sometimes paired with civil or criminal penalties.
Enforcement is uneven. Some states authorize forced divestiture; others rely on civil penalties or registration alone. Whether state agencies can actually identify violations is an open question in many places.
Court Challenges to State Bans
Several of these state laws are already in litigation, and the outcomes so far show how unsettled this area is. The most-watched case involves Florida’s SB 264, which restricts property purchases by Chinese nationals who are not U.S. citizens or permanent residents. Plaintiffs argued the statute is preempted by FIRRMA and violates the Equal Protection Clause.
In Shen v. Simpson, the Eleventh Circuit issued a partial injunction in 2024, finding a substantial likelihood that portions of SB 264 are preempted by federal law on foreign investment.9Congressional Research Service. Foreign Ownership of U.S. Real Property – Developments in Shen v. Simpson In a November 2025 opinion, the same court issued a mixed ruling: it affirmed the denial of a preliminary injunction on the registration and affidavit requirements, but reversed on the purchase restriction, finding the plaintiffs had not shown standing to challenge that provision.10United States Court of Appeals for the Eleventh Circuit. Shen v. Commissioner, Florida Department of Agriculture and Consumer Services The case went back to the lower court.
Preemption is the argument state lawmakers most fear. If federal courts eventually hold that FIRRMA and CFIUS occupy the field, state bans could fall wholesale. The lower court in Shen initially rejected that argument, reasoning that states have long regulated foreign land ownership and that CFIUS is distinguishable from earlier federal regimes.9Congressional Research Service. Foreign Ownership of U.S. Real Property – Developments in Shen v. Simpson A parallel challenge to Texas’s SB 17 was dismissed on standing grounds because the plaintiffs, as legal residents, were not covered by the law.
How the Buyer’s Identity Changes the Rules
Chinese ownership is not treated as one category. The scrutiny depends on who the buyer is.
Private Individuals
Federal law does not prohibit a foreign national from buying property. A Chinese citizen on an H-1B or F-1 visa can generally purchase a home or investment property without federal restriction. State laws vary. The strictest ones target people who are neither U.S. citizens nor lawful permanent residents and who are domiciled in a country of concern. A green card holder typically falls outside those restrictions; someone on a temporary visa may not.
Private Companies
Chinese-owned companies without PRC government control sit in the middle. CFIUS may still review a transaction near a covered installation, but these buyers are less likely to draw the heightened concern reserved for state-backed entities. Some state statutes define “foreign entity” broadly enough to capture any company organized under Chinese law regardless of government ties.
State-Owned Enterprises
Companies with direct Chinese government ownership or significant government control face the sharpest scrutiny. CFIUS treats government-linked buyers with added suspicion because their motives may be strategic rather than commercial. Several state laws single out entities controlled by foreign governments. In practice, a Chinese state-owned enterprise trying to acquire farmland or forestland will almost certainly encounter both a CFIUS review and any applicable state restriction.
Residential Property Versus Farmland
The public debate focuses on farmland, but the rules do not always track that focus. Federal law draws no property-type distinction on the right to purchase. CFIUS jurisdiction depends on proximity to military installations, not whether the parcel is a house or a farm. AFIDA reporting applies only to agricultural land, so a Chinese national buying a suburban home has no USDA disclosure duty.
State laws are the wildcard. Most target agricultural land, but some extend to residential or commercial property near military bases or critical infrastructure. Florida’s SB 264 sweeps more broadly than farmland alone. A buyer looking at a home in a state with foreign ownership limits should check whether the statute reaches residential property and whether proximity to a listed site triggers additional restrictions.
Tax Withholding When a Foreign Owner Sells
The Foreign Investment in Real Property Tax Act (FIRPTA) creates an obligation many foreign owners miss until closing. When a foreign person sells U.S. real property, the buyer generally must withhold 15 percent of the total sale price and send it to the IRS.11Office of the Law Revision Counsel. 26 USC 1445 – Withholding of Tax on Dispositions of United States Real Property Interests That applies whether or not the seller made any profit. On a $2 million parcel, $300,000 is held back at closing.
A reduced 10 percent rate applies if the buyer will use the property as a personal residence and the price is between $300,001 and $1,000,000. If the price is $300,000 or less and the buyer will use it as a residence, the buyer may be exempt from withholding entirely.12Internal Revenue Service. FIRPTA Withholding Those lower tiers mostly affect residential deals, not the large agricultural transactions driving the ownership debate.
A foreign seller who expects the actual tax owed to be less than the standard withholding can apply for a withholding certificate on IRS Form 8288-B at or before closing.13Internal Revenue Service. About Form 8288-B – Application for Withholding Certificate for Dispositions by Foreign Persons of U.S. Real Property Interests That step matters because withholding is calculated on the gross sale price, not the gain. Without the certificate, any overpayment comes back only after filing a U.S. tax return and waiting for a refund.