Chinese Stock Market Crash Good or Bad for US Housing Market in Big Cities?

[Frank Jiang]

Also another 8.5% drop just today.

http://sandiegofreepress.org/2015/07/chinese-stock...

http://www.cnbc.com/2015/07/09/will-chinese-buyers...

From the articles:

- Chinese are the largest foreign buyers of US housing.

- Chinese investors have shown the most interest in the San Francisco Bay Area (34 percent), followed by New York City (22 percent), Los Angeles (17 percent) and San Diego (13 percent) and growing interest in Miami.

Does anyone have an opinion on how this will effect your market if you're in one of these big cities or if it will effect the market at all?

[Sam Van Horebeek]

Our firm East-West Property Advisors (based in Hong Kong and Shanghai) did a survey a few weeks ago asking exactly that question. The result is that, because of the volatility of the stock market, 50% of the respondents are now considering buying overseas real estate.

Overall, different opinions prevail among Chinese citizens:

- High net worth Chinese are interested in buying US real estate no matter what the stock market is doing. They know that the stock market is considered to be a "gamble" and a rise/fall does not affect their overseas real estate decision making. Some might accelerate their purchases of real estate in overseas countries now.  

- Some other Chinese are certainly looking to have more exposure to overseas investment options but not necessarily real estate. This is because property typically has a higher price point and many Chinese cannot afford that (yet), or they do not have the means to transfer the money out of the country (There is a 50,000 USD limit per person per year in transferring money out of the country)

- Lastly, the retail Chinese citizens  (lower income) are planning to see how things will go with the stock market. Their money is tied up in the stock market so they are not able to do anything else anyway