U.S. real estate a bargain for Chinese – Real estate- msnbc.com
While China’s ultra-rich have been buying property in the U.S. for years, the buying tours are new, made attractive by still-rising Chinese income levels and American real estate prices that have been falling for two and a half years.
More than 100 Chinese buyers have joined such tours since late 2008, according to Chen Hang, the China-born vice president of real estate at Fortune Group. The Pittsburgh, Pennsylvania, company shows foreclosed commercial property to Chinese buyers.
Trips are pricey. Ying, the lawyer, paid $2,200 — nearly the equivalent of the annual income for many Chinese — plus airfare.
Participants in a 10-day January tour organized by Beijing-based Environment International Travel Agency had to show proof of an annual income of at least $30,000 and that they owned a car and property in China.
A real estate developer from the southern city of Changsha said he spent $3,500 for the 10-day trip to view $500,000 to $1 million homes, and it worked.
He found a house in California’s Silicon Valley that he planned to buy for his 20-year-old daughter, a university student in Boston who plans on attending graduate school in the Bay area.
“My daughter’s monthly rent is $1,000, so it makes sense to buy a place, because I’m getting a return rather than throwing money away,” said the developer. He would talk on condition that he be identified only by his surname, Zeng.
The price of the house, he said, was $1 million, compared with $1.3 million before the crisis in early 2007.
“The price is low now, but it’s in a good neighborhood with breathtaking views, so it will definitely appreciate,” he said.
Burbed reader T submitted this recently. (Actually, a few others had posted this in the comments too, I just never got around to posting it.)
Let’s face it – this can mean only 1 thing: Having prices ending with 888 really works! Forget burying St. Joseph statues upside down in your backyard! This is much more effective!
I know that some of the more cynical will point out the similarity of this to how the Japanese bought all that real estate in NY (Rockefeller center!) and ended up losing tons of money. Well, to this I would point out these key differences:
1. That was in NY. There’s nothing of value there. California baby!
2. That was for commercial real estate. Everyone knows that residential real estate is a much better investment.
3. This time it is different.
Good thing so many school districts in the Real Bay Area are preparing our children for the inevitable future by offering all-Mandarin-all-the-time education!
Maybe I should call this site Burbed 888!