It is said that a big factor in the rise of property values in SF is the money coming in from China.
A realtor friend of mine here in SF was narrating the tale of a house (on Pacific Heights, one of prime neighborhoods) going for sale for $2.7M, and ending up being sold for $3.5M after a bidding war... between 2 Chinese men, both of whom were in China, and were buying the property sight-unseen, all cash.
I find it a bit smarmy the realtors who imply they can get your property attention from these out of the country investors. It reminds me of the old trick of the realtor showing you a picture of the buyers to enable discrimination without actually bringing it into the conversation.
That said, for a number of foreign nationals buying real estate is a more durable way of expatriating wealth because it is hard to 'freeze' and it can be difficult to claw back. During the Iranian crisis there was a student at USC in my dorm whose parents were sending him money by first buying a number of houses in west LA and then funneling the rent money to him as his monthly allowance. It seemed very creative.
Wait - so they could freely send money from Iran to the US to purchase houses worth millions, but they couldn't send thousands as allowance but instead had to rely on said houses' rent? That seems weird.
It was possible to move money but difficult. Doing so once in a lump sum meant you wouldn't have to worry about the reliability of regular bank transfers across borders or fear your accounts being frozen once you were successful a single time. Seizing a house is much more difficult than freezing a bank account.
Don't forget that it's in a realtor's best interests to stir up the pot about all this foreign money. "Bid higher or the Chinese will outbid you!!".
Apparently there was a scam in Vancouver, BC where a local realtor group was busted doing this exact thing.[1] They took a couple of their Chinese employees and had them wander around expensive homes with a story about buying up a ton of real estate.
Very smarmy. And they weren't the only ones doing it.
The other approach is figure out what the house is worth to you. Figure out what your max is before you start bidding and don't go above it when the bidding starts.
Good approach. To elaborate, bid the lesser of your value or market value. Always. If you feel the least bit of pressure, or feel there's any shenanigans going on, walk away.
Deeds are public record so you can always check to see if a single person/entity is buying up many properties in an area. Sites like whydontweownthis.com are making it easier to check as well.
I've heard the same. I had some friends who were house hunting and placed six bids on homes in the peninsula, only to be out-bid at least 20% in cash over the valuation of the home each time.
They ended up getting a house finally at 10% over, but only after convincing the person to close early and not list it. They claim it prevented the foreign investors from finding it.
That could be due to more robust private property protections, and the fact that China would have much more trouble confiscating property in US than cash in case of some dispute. That doesn't explain why anyone would want to bid up a specific city, though.
Apparently, the Chinese (from mainland) prefer San Francisco to other cities because SF already has a large and vibrant Chinese population, so it's easy to adjust to life here. It is also physically close to China.
The same goes for Vancouver, which the article briefly mentions.
A study in 2010 reported that of the 164 sales of $3M+ homes in Vancouver's West Side (richest area) and Richmond (largest chinese suburb of Vancouver), 74% went to buyers with Chinese last names. This number was 46% in 2008. Not the most scientific study for many reasons, including 2nd/3rd gen Chinese, but knowing Vancouver, that demographic doesn't intersect with the affluence much at all. This "study" wouldn't work as well in SF, but you get the point. There is a lot of yuan coming to the west coast.
Glen Waverley, Box Hill, Springvale and then the spillover. I can't get a look in. One house went for $200k over the asking price. Glen Waverley has supposedly ~25% Chinese but its a lot more in practice. There are also a lot of Indians looking in the surrounds. There aren't that many anglo people at the viewings at all.
I was talking to a mortgage broker and he said that in some cases the children were advance parties with parents money.
A lot of the estate agents are Chinese as they cater to the Chinese.
I work in Melbourne's Docklands area and the situation here is similar with many of the local RE offices obviously catering to the overseas Chinese market. From my office window I can see a nearby condo where 2 bedroom units sell for $550k+ but the ground floor commercial units are almost all vacant. And another building is going up next-door. In the other direction I can see a massive new tower going up next to the Crown casino in Southbank.
A month ago my neighbour sold her old 3 bedroom house for $650k whereas the same sized house I rent with a much nicer backyard costs me only $21k/year.
Australians are in for a shock when economic reality kicks in and the consequences of a speculative real estate bubble become apparent...
You may be right on both points, but the two are not necessarily related.
Wealthy Chinese people (who the article is about) generally do not live in Chinatown because Chinatown is a ghetto. The wealthy ones tend to live in the suburbs. The demographic of Chinatown just doesn't tell you very much about the demographic of Chinese people in the SF bay area as a whole.
There are a lot of other Chinese neighborhoods in SF besides Chinatown, though. There are a great many Chinese people in the Richmond district and also in the Sunset, which even has a small Uighir community). Chinese people make up a much larger share of the population in SF than in LA, IMHO. And there's a lot of other Asian enclaves around the Bay Area. OTOH there are a lot more Korean people in LA than in the Bay.
I remember back in the late 90s when Vancouver's Chinese community were mostly Cantonese speakers; that changed very quickly to mandarin after the HK handover.
Re-read the OP; that's exactly what he was saying.
A cantonese-speaking community outside of China generally means it traces its roots to pre-Communist takeover of the mainland, a time when most immigration came through the British controlled territories around Hong Kong.
The OP is claiming that SF's chinatown is more Cantonese than Los Angeles, the implication being that the more Mandarin speaking Los Angeles community has closer ties to modern mainland China.
Based on personal experience, I think that may have been true 20 years ago, but not so much today. At least outside of Chinatown proper, which I don't spend much time in.
He said Chinatown, not SF Chinatown, I assumed he was referring to LA's Chinatown, which definitely exists.
SF Chinatown is just a tourist trap these days. Many more Chinese live in the Richmond neighborhood and throughout the bay area. Also, many of the Cantonese speakers in the Bay Area (usually south bay) are actually from Vietnam (ethnic Chinese refuges who left during the Chinese/Vietnam war in the late 70s/early 80s). I assume that is quite similar to the situation in LA, but have no direct knowledge.
There is pre-existing immigration from british areas, but they have mostly diffused throughout the country and are probably on their 4th or 5th generations by now. If you meet someone in the states who speaks Cantonese, they are more likely to descend from Vietnam, or somewhere else in Southeast Asia, rather than Hong Kong. Though I once met a cantonese speaker who immigrated from...Belize.
But I guess you are right...over a few hundred years and many intermediate destinations they did eventually come from Guangzhou/Hong Kong :)
A realtor friend of mine here in SF was narrating the tale of a house (on Pacific Heights, one of prime neighborhoods) going for sale for $2.7M, and ending up being sold for $3.5M after a bidding war... between 2 Chinese men, both of whom were in China, and were buying the property sight-unseen, all cash.
http://blog.sfgate.com/ontheblock/2014/05/02/catering-to-chi...