All Forum Posts by: Sam Van Horebeek

@Sam T. That is correct.  We see a lot of investors from Asia putting down full cash offers on a range of listings across different American cities.  Besides the metropolitan areas, investors from Asia have done transactions in cities such as St Petersburg, Detroit, Sacramento and other 2nd tier or 3rd tier cities. It is surprising indeed but then it does make sense for these foreign buyers as a 6% rental yield can still be good compared to their local markets or they simply like to have some assets in a more stable/mature real estate market.

@Tim Jones It is interesting to read your concerns while we are seeing a continuous drive for California homes from Chinese.  Of course, they have other reasons to invest in California than you have but it is still quite interesting to see how the sentiment is so different there in California compared to what we see here in China. Chinese do love the American houses - and they usually think really long time!

Having said that, there is no wrong time to invest if you find a good deal, can leverage at a low rate and you are a long term investor. It is frankly very hard to time the market and in the meantime, your cash sits on a checking account making 0.5% per year.  If you can borrow a good amount of funds (while you have a good credit and a job - both of these items might become more difficult during a recession), and you can find a deal that has long term potential, you probably should consider it.  Good luck!

@Brian Filmore

Here is the latest from China on your question:

1. Positive reaction immediately after Trump election (Nov 8 2016)

2.  Hesitant reaction after the Trump administration announced the ban on people coming from 7 countries (at end of January 2017). Chinese have adopted "wait and see" approach

3. Today (March 2017) - Chinese are getting a bit more open towards the US real estate market again (but face some FX issues now in China)

@Luisito Espanola

Yes you can but it depends on the value of the property.  If it is too small (value less than 500K USD), most US banks do not bother to deal with it.  It also depends on the city - it will be easier for major coastal metropolitan cities compared to smaller cities. 

I think it is best to connect with people located in the countries that you are interested in. If you are keen on China or Hong Kong, please feel free to PM me.  I am not an expert but can give some anecdotal information. Good luck

It is difficult to predict whether real estate prices in California will go up or down in the near term. it also depends very much on exactly where - SF has been going through up and downs but I think most of us had wished they had bought anything in that city at any point over last 15 years. It has seen bubbles and crashes but if you sat those out, you would have made some decent capital gains.

I can also add that there are a large amount of Asian investors who are interested in California. Chinese now have some foreign currency issues to deal with but I can tell you that the demand is huge, so once the capital controls are released the funds will flow back into California.

@Jason Zeall Welcome to BP. I spend a lot of time in Hong Kong so feel free to connect.  Good luck with your trip in the UK - surely you should make a similar trip to the US and you might find some interesting numbers.

There a few key items that you can consider for out-of-state (or in our case out-of-country) investing.  

1) What is your goal? 

Rental income, long term appreciation or both? Of course, it is important to consider your risk tolerance.  It is also important to quantify the return numbers that you are looking for.

2) What is your budget? (and linked to this is the amount of financing that you can get)

Based on the above, it will narrow down the search to certain cities or areas. Then it becomes a matter of your level of comfort/ease of access/getting to know locals on the ground that you can trust.  I am confident that there are good deals to be made across multiple cities in the US as long as you have the right resources (especially people) to give you the right information.

As a result, most of our inquiries that we see pass through our platform are from investors in Asia who have never been in the US but they are doing a lot of research and due diligence.  Then they do make these purchases that you keep on hearing about in cities such as Seattle, San Diego, NY, Boston, Westchester, Orlando, Dallas, Houston,... and yes, many of the investors have never been to any of those cities.  They are simply talking to a large amount of people in Asia and in the US before they do purchase though.

@Hal Thompson Good question and surely it would be good to get data around this (if available). 

Generally speaking, we do see that Chinese take much longer time to buy a house in the US due to the tight capital controls. As you probably know, since January 1, the regulator here in China is now requesting that anyone who is purchasing USD currency declares the purpose of that purchase. If the purpose is overseas real estate investment, they won't be able to purchase that foreign currency.

Having said this, the 50000 USD limit per person per year has been in place for many years and we see that Chinese continue to find ways around it.  

I wouldn't be surprised that some Chinese were caught off guard when the new regulation was put in place.  We currently still see Chinese traveling to cities such as Seattle, SF, LA, NY, Boston,... and we often ask them about this capital control. Many of them are indicating that the money transfer is challenging but they also mention that they will be able to make it happen...

From a China perspective, Seattle has become one of the cities that has seen most of the inquiries through our platform.  San Francisco and LA are popular too but it seems that prices have become so high in those 2 places that Chinese investors are starting to focus more on Seattle.