Share of Chinese-Speaking Buyers Paying Cash for U.S. Homes Increased 229 Percent in the Past 10 Years

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The FINANCIAL — RealtyTrac and Ethnic Technologies, one of the global leaders in digital multicultural marketing, research, data enhancements and analysis, today announced findings from a joint analysis of 10 million publicly recorded residential property sales deeds in 2014  and 2015 compared to 2005 by ethnicity and native language spoken.

The analysis found that 46 percent of Mandarin Chinese-speaking buyers who purchased U.S. homes in the 17 months ending in May 2015 paid all-cash, up 229 percent from the 14 percent share paying all-cash in 2005 — the biggest increase of any language group, according to RealtyTrac. 

Among all language groups, the share of all-cash buyers of U.S. homes increased 65 percent from a 20 percent share in 2005 to a 33 percent share in the 17 months ending in May 2015.

“Cash buyers across the board are playing a much bigger role in the housing market now than they were 10 years ago, and that is particularly true for Chinese Mandarin-speaking cash buyers, who are more likely to be foreign nationals,” said Daren Blomquist vice president at RealtyTrac. “Foreign cash buyers have helped to accelerate U.S. home price appreciation over the past few years given that these buyers are often not as constrained by income as local, traditionally financed buyers.

“Markets with a higher share of foreign cash buyers may expect to see a stronger upside in the short term given the continued global economic instability,” Blomquist continued. “But those markets are also more susceptible to a downside in the longer term when demand from foreign cash buyers dries up.”

Mandarin Chinese speaker share of all buyers increases most of any language group

Mandarin Chinese-speaking buyers also increased as a share of overall buyers more than any other language group between 2005 and 2015, up more than 9 percent.

“Asian, Hispanic and African American consumers are driving the substantial growth we are seeing in both real estate and marketing-centric markets”, said Zachary Wilhoit, CEO of Ethnic Technologies. “Just these three segments are about to be 50 percent of the U.S. market and already represent major market shares in the fastest growing Digital Market Space.”

To understand the other ethnic and language trends occurring in the real estate market and which buyers are ready to pay in cash, contact RealtyTrac or Ethnic Technologies directly using the contact information below.

Broker Quotes

“According to the Asian Real Estate Association of America, Seattle is currently the sixth most popular destination for Chinese immigrants in the world. And there’s good reason for it; Seattle is the closest mainland U.S. city to travel to from Beijing and offers things that really appeal to the Chinese, like clean air, quality education, and employment opportunities with several Fortune 500 companies,” said OB Jacobi, president of Windermere Real Estate, covering the Seattle market. “This is why Chinese buyers are now estimated to represent upwards of 40 to 50 percent of all real estate activity in Seattle’s most expensive neighborhoods, of which at least 75 percent are paid in cash. While some call this a trend, I believe it’s an emerging aspect of our market that’s here to stay for the foreseeable future.”

“International commercial investors and business owners are attracted to the Ohio markets for affordable labor resources, attractive facility options, and a pro-business tax base; these international investments continue to provide for employment and housing needs that become the foundations for the state’s continued economic growth,” said Michael Mahon, president at HER Realtors, covering the Cincinnati, Dayton and Columbus markets in Ohio. “Much of the growth concerning international buyers is in our major metropolitan areas of Columbus, Dayton, Toledo, Cincinnati, and Cleveland; due to transportation and logistics benefits coupled with employment opportunities.”

“Annually since 2005, we have seen that destabilizing events around the world continue to increase the positioning for U.S. real estate, particularly Southern California, as a safe harbor for investment, particularly cash,” said Mark Hughes, chief operating officer with First Team Real Estate, covering the Southern California market.  “Given the somewhat laid-back Chinese government attention to withdrawal limits we expect these funds to continue to be a driver of activity and bidding throughout this year.”

“Clearly, there is an uptick in international buyers from the perspective as a recruiter and trainer.  Several of our new brokers are working with international clients and one new broker, who is also Chinese, is writing her third transaction in two months, ranging from $650,000 to over $1 million,” said Heidi Greer, broker at RE/MAX Alliance, covering the Denver market in Colorado.  “She is seeing both cash and low down payment financing buyers with an extensive Chinese network both at home and abroad.”




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