What to Know About Asian Homebuyers
In major population hubs like New York City, San Francisco and Los Angeles, this trend is especially apparent as these investors indicate an outbound capital flow from their home countries by investing in American industries like agriculture, technology and, of course, real estate.
In fact, Forbes reports that Chinese nationals have become the largest foreign buyers of American homes. In this industry, home purchases by China’s new wealthy class have grown to a staggering $93 billion in value, with $29 billion coming in 2015 alone.
So, with evidence pointing to this surge in Asian national buyers, you may be thinking: “How can I help this type of client find a new home that suits their needs?”
While Asia is a giant continent with numerous countries with their own cultural beliefs, there may be a few considerations you’ll want to have in mind when assisting Asian homebuyers.
Take the Time to Understand Their Customs
Many homebuyers coming from Asian countries have customs and belief systems that directly affect the homes they can buy — from the direction the home is facing to the history of the land it is built upon.
Two common belief systems to keep in mind with some Asian buyers are Feng Shui and Vastu, which have certain rules regarding a home’s architecture and energy flow.
“Realtors dealing with newly built homes should know the site layouts and designs,” says Jessie Kim, a Feng Shui consultant in Southern California who often works with homebuilders and investors on catering to this Chinese philosophy. “What is going to be built around the properties, home addresses and what types of landscaping plans and materials will be used around the homes are important things to consider.”
With Feng Shui, some common things to avoid are “T” intersections, cul-de-sacs, corner lots, a front door facing the back door or window, stairs and bathrooms facing the front door, kitchens and bathrooms facing or back-to-back to each other and bathrooms directly above the kitchen. You’ll also want to focus on showing homes with a front door that faces south or southeast.
“There are ways to remedy most of these issues, but the less Feng Shui remedies you have to do to the house, the better the home is,” says Kim.
And with Vastu, a Hindu architecture system, the direction of the front door is also very important, as well as having a dedicated space for spiritual statues.
“Just like with Feng Shui, there are different layers that the buyers will be considering, so it’s important to ask the what their Vastu needs and wants are, besides just asking for the number of bedrooms and bathrooms they want in their home,” advises Kim.
A simple question-and-answer session with your clients can help bring to light any of these cultural beliefs and requirements so you can find a home that suits them perfectly.
“Just try to learn about their custom,” adds Kim. “Simple things like taking off your shoes when entering their home will make the homeowners feel comfortable that you are understanding of their culture.”
Discover Their Reason for Buying
The next tip is a simple one: Just find out why they are buying.
“You have to think about what their reasoning is,” says Joan Brothers, president of Manhattan Boutique Real Estate in New York. “And there’s a lot of different reasons why people are coming from Asia to the United States and buying real estate as assets, whether they’re using it for their residential property or as an investment.”
With Chinese investors specifically, there are different levels of buyers. For years, wealthy buyers have been looking to foreign countries to invest their money and now the middle class have been increasingly doing the same thing.
“The main thing will be to send their children to school out of their country,” says Kim. “So by investing in a home in the U.S., they are able to set up residence and when their children are older, they are able to go to school in the U.S. without having to be an international student.”
Having insight to what they want in a new home, whether it be for a residence for their family or just as an investment asset, can better enable you to find a property that fits their needs.
“And diversifying assets is a really good thing to do,” adds Brothers. “It’s either family or business, personal use or for investment.”
And if you discover that they are looking for a home to set up residence, the next thing to consider is their family values.
“These types of buyers are looking for a home that they can ‘share’ with their family,” says Kim. “Maybe not full time, but they are always aware of possibilities of their families coming to visit and staying with them for extended periods of time.”
So, it may be important to find them a home with an extra bedroom on the ground level or options for multigenerational living. Close proximity to parks, shopping and schools with good ratings would be another major plus, adds Kim.
It’s also wise to make sure you keep everyone involved in the process feeling just that — that they are involved.
“Buying a home is mostly a family decision,” says Sylvia Yang, a sales representative for Brookfield Residential in Azusa, Calif. “Parents and grandparents will often gift the down payment and they need to confirm they like the location and floor plan as well.”
Tying it all together, it really comes down to genuine and personal conversation and asking questions.
“If you can make simple conversation and are interested in the client’s culture, you can create trust and a long-term relationship with them,” says Brothers.