California continues to draw heavy investor money from China alongside their massive boom over the last decade. Yet a big part of this is speculation and we actually see this via rents. Rentals are more reflective of what local families can pay. It is interesting to see in some highly desirable areas that rents go for $2,500 to $2,700 while homes are selling for $700,000 to $750,000. Foreign money is a big player in the current market and this is also very dependent on foreign economies sustaining their booms.
Chinese investors heavily favor coastal regions
The National Association of Realtors (NAR) recently released data on foreign real estate buyers. What was interesting is that the latest figures show that international buying is at an all-time record high coming in at $92.2 billion dollars of volume.
In other words, not only are locals being priced out but even professionals in the area are being priced out because of added international competition.
Volume of purchases is still largely driven by Canadians but they are looking at other areas outside of California.
– Canadian Searches: Las Vegas, Detroit, Los Angeles, Ft. Lauderdale, Miami, Orlando, Chicago, Naples.
– Chinese Searches: Los Angeles, San Francisco, Irvine, New York, Las Vegas, Detroit, Seattle, Miami, Orlando, Boston Anderson SC, Chicago, Houston, San Diego