The Chinese See Trump’s Rise as Positive for Investing in US Real Estate
Trump is selling houses, but it has nothing to do with Trump properties. According to recent findings by Investorist, a global marketplace for off-the-plan properties, the U.S. President is not only instilling confidence in wealthy Chinese homebuyers, but influencing where they buy.
“President Trump is seen by the Chinese as a very rich and successful property developer, and [Chinese buyers] feel this is a positive for investing into US real estate,” Jon Ellis, CEO of Investorist, told Jing Daily at the company’s annual China Connection earlier this year. His comments were based on an internal report by the company. “Trump’s long involvement in the real estate industry gives confidence to the Chinese that the United States will continue to be a good place to invest.”
At China Connection, an event that featured global developers and home building companies along with hundreds of Chinese property professionals, Investorist revealed the investment effects of the current global economic and political climate, including specific events like Trump’s meeting with President Xi Jinping in Florida.
“President Xi Jinping’s visit to meet with Trump at South Florida’s Mar-A-Lago generated enormous media coverage across the country both in the lead up and during his visit,” said Ellis. Though that meeting was in Palm Beach, it had a broader impact on the area. “Miami as a good value ‘global city’ is gaining popularity with Chinese buyers,” he said.
This confidence in Donald Trump and his business acumen is a key factor behind Chinese-specific investment in the US, and is influencing everything from price point to location.
According to the 2016 Profile of International Activity in U.S. Residential Real Estate put out by the National Association of Realtors (which measures sales to international clients of U.S. residential real estate), Chinese buyers were the only group more likely to visit the United States as a consequence of Donald Trump’s presidency.
For the second year in a row, the above-listed report found Chinese buyers were the top foreign buyers of real estate in the United States, purchasing US$27.3 billion in residential property—nearly one-third of the total dollar volume sold.
The Value of the Trump Brand Overseas Has an Effect in New York
With regard to his own properties, it seems Trump’s effect is likewise positive, or at least neutral.
“Chinese buyers still express strong interest in all Trump New York properties,” said Nikki Field, Senior Global Real Estate Advisor and Associate Broker at Sotheby’s International Realty. Field said that the enthusiasm from Chinese buyers about buying Trump buildings did not fade after the election.
“They love that brand as it has a very significant value overseas. So it is contrary to New York buyers who are a little more locally snobbish.”
Field’s observation was confirmed by a Manhattan-based Chinese real estate broker who works with Citi Habitats and Brown Harris Stevens.
“This year, so far, I have already helped four Chinese clients buy luxury apartments at Trump Place 220 located at Riverside Drive,” said the realtor about the property in the Riverside South development on Manhattan’s Upper West Side. “The biggest deal that I made amounted to $1.26 million. We have signed the contract and the apartment will be delivered to my client this upcoming August.”
A slew of data compiled by the local real estate news site The Real Deal based on its analysis of information on StreetEasy also suggested that actual sales of condominiums at Trump Tower have not been appreciably affected by the political climate. The number of apartments sold in 2016 was 22, up from 15 in 2015 and 11 in 2014. The increase of sales even came amid a fall in the city’s luxury apartment market.
“Trump’s political stance has nothing to do with where I choose to stay,” said Nick Wang, a 29-year-old Chinese national who has resided in one of the Trump’s properties in New York since he moved there in late 2015 to attend university there.
Several months after Donald Trump announced his presidential candidacy, Wang visited several luxury service apartments before deciding to stay at the Trump property because it offered him “the best value.”
“I am Chinese,” he said. “So, I guess I don’t feel the way [the locals] do.”