Strategic Thinking Realtors:

amid the coronavirus pandemic, is it time to even consider engaging China buyers for your listings?

When you are reading this, we wish that you and your loved ones are safe and well during this unprecedented public health crisis in modern times. As we are all taking the best care of our families and those in need, some of us, while trying to make sense of all the uncertainties, have been thinking ahead about customers’ demand as we expect to ride out this storm eventually. 

For realtors, should you consider marketing to Chinese buyers, both residential and commercial, and why? 

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It is well-publicized that the US home purchases by Chinese had dropped drastically, reporting a 56% decline YoY as of July 2019 according to CNBC.  Such a decline was attributed to the confluence of China’s capital control, the tightening of the US immigration policy, the slowdown in China’s economic growth, and the slowdown in the US property appreciation. The pandemic has only exacerbated almost all of these negative influences. The latest headline said it all: Chinese Real Estate Investment In The U.S. Comes To A Standstill. So why would anyone bother with marketing to Chinese buyers? 

Stripped of rosey unrealistic expectations, putting on the hat of a realtor with a focus on selected properties, we see a number of reasons to encourage such a preparedness.  

• First, despite all the constraints, the pressure for Chinese investors to invest overseas is only growing. A quick review of the recent history can be very telling. Triggered by the 2008 financial crisis, along with other global policymakers, China exercised a massive economic stimulus program in an effort to stabilize the economy. The ensuing recovery and growth, plus the excess of monetary supply, had driven up not only the domestic housing price to record high, but also the explosive growth in Chinese investment in US properties until it reached the peak in 2016 ($31.7 billion for residential and $19.1 billion for commercial real estate in the US) when China started reversing its quantitative easing. And the decline in US property investment from China followed. Now facing the severe impact from the coronavirus crisis on top of the economic pressure caused by the preceding trade war, China central bank is swinging back to QE, regardless of its flavor, again. An exclusive report from Reuters early April 2020 told the story. History tends to repeat itself. This easing is most likely encouraging investors in China to look for real estate markets overseas, and the US is still a very prominent one. 

• Second, from an event-driven perspective, the recent movement in China towards the digital currency is also stirring up the conversations on how to safeguard asset values, including concerns over currency fluctuations as well as privacy issues. This type of sentiment tends to strengthen the motivation of buying overseas assets.  

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• Third, the pandemic has led to speculations of a real estate market cooling off period in the US. Plus, with certainty, there are going to be buying opportunities, both residential and commercial, to emerge as the economic impact is fully revealed. Following Warren Buffet’s famous mantra of being greedy when people are fearful, all real estate investors with cash are likely on the lookout, and China investors are no exceptions.  

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• Last but not least, macro market conditions aside, for realtors working with selected residential and commercial properties, finding the right buyer is always a desirable possibility when the price is right. For your listings, why not consider Chinese buyers as part of your target audience? 

Still need some numbers? Let's go back from a global perspective to our digital marketing vantage point.

From the Baidu Index (just in case, Baidu is still the largest search engine in China) data, we are observing a rise of Chinese users' interest towards search queries such as  “US real estate”, “overseas real estate investment”, “US housing prices” starting from February 2020.