U.S. Sees Big Spike in All-Cash Chinese-Speaking Buyers

Almost half of Chinese homebuyers across the country are paying for their purchase entirely in cash, a substantial increase over the past decade.
A RealtyTrac blog post says that for the 17 months ended May 2015, 46 percent of transactions by Mandarin-speaking buyers were all-cash deals, up from 14 percent in May 2005. Nationwide, all-cash transactions rose from 20 percent in 2005 to 33 percent in 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,” RealtyTrac Vice President Daren Blomquist said in a statement accompanying the report. “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.”

Over the past decade, Mandarin-speaking homebuyers have increased by 9 percent, more than any other foreign-language group. Earlier in the summer, a survey by the National Association of Realtors found that buyers from China were responsible for 16 percent of U.S. international property sales, also the most of any nationality. For the 12 months ended March 2015, China invested almost $29 billion in the U.S. housing market.

The Bay Area is a top destination for Chinese homebuyers, who are attracted to the region for its relative value compared with property costs in other international cities, high-caliber educational opportunities, and healthy lifestyle. In an April interview, Pacific Union CEO Mark. A McLaughlin told SFGate that 25 percent of homebuyers in Palo Alto had a connection to China.
McLaughlin, who developed and implemented Pacific Union’s unique China Concierge program in 2013, will travel to Beijing in November to present at Hurun Report’s 2015 Top Entrepreneurs Forum.

(Photo: Flickr/401(K) 2012)


Article and images sourced from http://blog.pacificunion.com/u-s-sees-big-spike-in-all-cash-chinese-speaking-buyers/

San Francisco One of World’s Hottest Luxury Real Estate Markets in 2014

After astounding growth in 2013, luxury property sales returned to more normal levels in San Francisco last year, although the region still ranks as one of the top-performing high-end real estate markets in the world.

In its 2015 Luxury Defined report, Christie’s International Real Estate gave San Francisco the second-highest score – 54 of a possible 100 – on its Luxury Thermometer metric, which tracks growth and demand at the top end of the global market. CIRE uses four factors to gauge a region’s luxury temperature, including annual sales growth and fewest average days on market.

In 2014, sales of $1 million homes in San Francsico grew by 19 percent on an annual basis, down from a whopping 62 percent in 2013. Pacific Union CEO Mark A. McLaughlin told CIRE that the slowdown was predictable and that the region’s high-performance economy will continue to drive growth in luxury home sales.

“The Bay Area is still experiencing a perfect storm of hot market conditions, exceptional job growth, excellent income levels, and limited supply,” McLaughlin said.

Because housing inventory in the Bay Area remains constrained, high-end homes in San Francisco leave the market quickly. According to the report, luxury homes in our region sold in an average of 71 days as of December 2014, eight days faster than a year ago and second only to Toronto.

And though San Francisco remains a pricey place to purchase a luxury property, it is still relatively affordable by global – and even national – standards. CIRE says the entry point for a luxury home in San Francisco is $3 million, compared with $5 million in New York, $6 million in London, and $8 million in Los Angeles.

Luxury buyers can also get more home for their money in the Bay Area than they can in other top international destinations, says the report, which compares listings from around the globe. For $5 million, a homebuyer in San Francisco could purchase a four-bedroom, 4,800-square-foot, single-family home with Golden Gate Bridge views. In London, $5 million buys a two-bedroom, 1,300-square-foot flat, while in New York, that money fetches a three-bedroom, 1,865-square-foot condominium on Manhattan’s Upper East Side.

Last year saw an uptick of so-called “trophy home” transactions, CIRE says, with global sales of $100-million-plus homes reaching an all-time high. According to the report, five such homes around the world sold in 2014, and there have been 13 $100-million-plus sales since 2010.

Perhaps unsurprisingly, two of those 13 trophy sales happened in Silicon Valley, where mind-bogglingly expensive real estate is almost a given. In 2011, a single-family home in Los Altos Hills found a buyer for $100 million, while a home in Woodside sold for $117.5 million the following year.

(Photo: Flickr/Allan Ferguson)

Article and image sourced from http://blog.pacificunion.com/san-francisco-one-of-worlds-hottest-luxury-real-estate-markets-in-2014/

San Francisco Shows Highest Annual Home Price Gain For Second Straight Month

The San Francisco metro area has once again put up the largest annual home price gain in the U.S., according to the most recent numbers from a prominent real estate index.

The latest S&P Case-Shiller Home Price Indices, which run two months behind, say that single-family home prices in the San Francisco area increased by 9.3 percent in December, the most of any of the 20 major U.S. metro areas included in the report. San Francisco returned to the top of the Case-Shiller index for the first time in 18 months in November, when prices rose by 8.9 percent year over year.

As was the case in the two preceding months, home prices in San Francisco grew at about double the national rate in December. Case-Shiller’s numbers put the U.S. annual rate of home price appreciation at 4.6 percent in the final month of 2014.

Although existing home price growth and sales across the country are at their normal levels, David M. Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones Indices, said that he believes the housing recovery is “faltering,” a by-product of sluggish construction and new-home-sales activity.

“Before the current business cycle, any time housing starts were at their current level of about one million at annual rates, the economy was in a recession,” Blitzer said. “The softness in housing is despite favorable conditions elsewhere in the economy: strong job growth, a declining unemployment rate, continued low interest rates, and positive consumer confidence.”

According to MLS data, the median single-family home price increased year over year in every one of Pacific Union’s Bay Area regions except the Mid-Peninsula subregion, which saw a slight decline. Home prices topped the $1 million mark in our Contra Costa County, Marin County, Mid-Peninsula, San Francisco, and Silicon Valley regions as 2014 came to a close.

The chart below provides more information on annual Bay Area home price changes. Also, be sure to check out Pacific Union’s fourth-quarter 2014 real estate report for more in-depth sales data and information on how we define our regions.

(Image: Flickr/Bhautikjoshi)

Article and images sourced from http://blog.pacunion.com/san-francisco-area-leads-us-home-price-growth-second-straight-month/