The trend that Chinese are becoming a prominent buyer of US real estate is well-known to most of us. As Reuters has reported recently, Chinese have become the largest foreign group of buyers of real estate in Manhattan. While much of the influx of Chinese money is for investment reasons, education is becoming another (maybe even more) important factor. As we all know education is something that parents love to invest in, and Chinese parents, who place a lot of expectations on their (most often) only child in the family, love to invest even more in education. This is especially true when they deeply believe that their child will receive a better education or be able to pursue a better life in the US instead of staying in China. Purchasing a property for their child who is going to study in high school or college is common for Chinese. Then the question raises "how to deal with Chinese parent buyers?" or "what's their preference?" Getting to know some of their concerns or consumer behaviors may help real estate agents in closing the deal more efficiently and more frequently.
Safety goes first
Due to the fact that the only child of the family is going to the other side of the world by himself or herself, parents consider safety as the most important factor in their decision process of buying a home. Price for example is only a secondary factor. Ms. Qin Hui, a mother of a 15-year-old boy, already started looking for a property at the East Coast, as her son probably will go to college there in two or three years. "My premier concern is to look for a safe place for my son," Qin said. "While he will come of age in three years, he is still a child who needs to deal with a new and strange environment, and we may only visit him a couple of times per year, so I want him to be safe all the time."
The newer the better
Many agents may have noticed that Chinese buyers tend to purchase new construction, or if there is no option, they still prefer to buy an apartment or house that is built in recent years or has been newly renovated. Mr. He, who used to be a PHD student and has been staying in US for nearly 8 years, has just bought his own house in South Philadelphia seven months ago. He shared his opinion on buying his house, "Apart from the location and price, I put a lot of importance on how new the house is." He mentioned that most of the Chinese buyers actually share the same preference on the degree of the house age. However, he pointed out that the interior decoration could play a tricky role, as sometimes even while the house itself is pretty old, it could still be suitable to Chinese buyers if the decoration is new. Sam Van Horebeek, Director of East-West Property Advisors (EWPA), a US real estate advisory company based in Hong Kong, shared his experience of dealing with parents in China looking to buy US real estate. "Chinese parents prefer to buy new construction, more modern houses or apartments that have relative short commute to the school or university."
Buying in a rush
Partly due to the lack of available information and language challenges, many Chinese parents often close a deal in a comparatively short time. An anonymous Chinese lady who is seeking to buy a property in Washington D.C. for her child who is going to study there, told the agent that she hoped to obtain the keys within three months. However, at that point in time, she had very little knowledge of the US real estate market. She did have the funds ready and just preferred to leave everything else to the local agent.
Accessibility and appreciation
Chinese parents who are buying a home for their son or daughter who will be studying in a US university also consider the commute and the appreciation potential in the future. Sam Van Horebeek from EWPA commented on the buying behavior of Chinese parents: "They look for neighborhood characteristics, such as the commuting distance to school, and they also care about the value of the property," he added, "They want to make sure that their real estate agent can negotiate the best price of the property for them." This feedback was echoed by Ms. Qin Hui. She emphasized that the apartment location should be as close as possible to the school, so that his son could commute easily everyday.
She also cares whether the property value could rise in the following years. "I'm just buying for my child’s education. I'm not planning to hold the property for a long time. As such, I prefer to find a property that will most likely appreciate. When I want to sell it later, it'll still be a good deal and I won't be losing my money."