Chinese Real Estate Investment Moves to Seattle, Washington
Vancouver, BC’s new property tax triggered a new wave of Chinese real estate investment in Seattle, Washington
Vancouver, which has seen detached-home prices 2X’d in the past 10 years, joined areas including Australia and Hong Kong in taking steps to slow housing demand after an unprecedented surge of foreign investment.
Chinese buyers are accelerating purchases overseas, spurred by a weakening RMB Yuan, rising prices at home and the perceived safety of real estate. They are venturing farther afield as costs rise in some of their favored markets.
Home-purchase inquiries from China have jumped in Seattle and Toronto since the Vancouver tax was announced, according to Juwai.com, the country’s largest overseas property website.
For Vancouver investors, Seattle is a lure because it’s a waterfront city just a few hours away by car. It is also more affordable than other West Coast destinations.
Toronto, as one of the world’s financial capitals, already has an established base of foreign investment in condominiums and a large Asian population.
Toronto and Seattle are the Top 2 contenders for Chinese real estate investments.
While there are no figures specifically showing purchases made by offshore buyers, brokers say demand in Seattle and Toronto has been robust, particularly for the high-end properties Chinese investors favor.
In Seattle, about 12% of all homes this year sold for at least $1-M, 2X the share over the last 10 years, according to the data. Single-family home prices jumped almost 15% in October from a year earlier, data show.
The average price of a Greater Toronto home rose 23% in November from a year earlier to US$586,530, while sales rose almost 17%, the local real estate board reported on 2 December. In Vancouver, BC sales plunged since July and were down 37% last month compared with the prior year.
The Seattle metro area has already seen a 50% rise in house prices in the past 5 years, thanks in part to a booming technology industry and growth in companies such as Amazon.com Inc.(NASDAQ:AMZN) and Microsoft Corp.(NASDAQ:MSFT)
The median home value is $409,900, less than in San Francisco and Los Angeles, according to Zillow Group Inc.
In Vancouver, the benchmark home price is C$919,300 (or $680,000), or C$1.06-M (or $782,000) with the news ax.
There are other dynamics at play boosting home prices in the area, such as limited supply, according to the chief economist at Zillow.
Regardless of where the massive flow of money out of China and Hong Kong goes, it will find a home as Asian investors look for a safe place to invest their wealth.
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