Millionaires Flee China, buys homes in USA

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jamboreedude

jamboreedude

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Peter Navarro, a professor at UC Irvine said the following: "i'm from orange country, California. we're seeing millionaires (refering to the Chinese from mainland China) and boat loads of cash coming in, they're buying 40 or 50 houses at a time. that's good, but that's 50 houses off the market for American homeowners..."

see CNBC video clip: http://video.cnbc.com/gallery/?video=3000111043&play=1

Your thoughts on the good and bad of the Chinese snapping up homes in Irvine?
 
this is reminiscent of my childhood where taiwanese worth their weight in salt all took their money out to the states during taiwan martial law... so im not particularly emotional about this issue, rather i just see it as the changing of the times...

u know... what pisses me off is they allow FCB's to bring money in n get a visa, actually they promote it... whereas what do they do for us when we want to bring money in? tax us... could there be any worse of a disincentive??

srsly... of course im gonna buy a cheapo home in irvine and then invest the rest in a foreign country... makes no sense for me to bring my dollars back home...

but whatever... FCB's in irvine is a good thing... lower foreclosure rate... and price the flim flam out...
 
We've had this conversation before.  Rich Chinese have 3 places to put their money in China.
1. Banks
2. Real estate
3. Stock market

The smarter ones use Hong Kong shell companies to get their money out of the mainland so they can diversify their risk.  I'm not sure how much money it takes to get money out of China, but assuming it costs 15% of the total, it's still worth it for rich Chinese to stash money in foreign countries.  So to get $100 out you would need $115.  This reminds me of Neil Heywood and Boxilai scandal where the guy got whacked for wanting more than the usual 15%.  Actually I don't know if it's 15%...but whatever.
 
btw im not understanding this animosity towards FCB's buying in Irvine... maybe its cause I lived in manhattan and los angeles for awhile so im used to random unamericanized rich ppl moving in next door shattering all my pride where their monthly trust fund checks equate to my annual salary :(

i mean i really dont get it... we buy things we cant afford, refuse to live within our means (the definition of this can vary from individual to individual, but i define living above our means when personal debt including mortgage and all loans exceeds 30% of an individuals net asset/value), cause our own housing crisis, cry when our home values tank, and then cry more when FCB's stop the free fall and prop up the value???

it just doesnt make sense to me, would u really rather see ur home value tank another 20% so that it is in line with the rest of california? the logic confounds me... perhaps it is too americana for a 2nd gen like me to fully understand...
 
also dont understand why ppl think they "made it" if they live in irvine... the only reason i bought in irvine was cause i cant afford a detached home in coastal los angeles, all i can afford are crappy townhomes here, so irvine was my safety... maybe my value system is a bit off but if living in irvine means "making it", then what does owning a detached in santa monica or lets say newport or manhattan beach mean? r ppl honestly really that unambitious that they are calling irvine "making it" or is that just the recession talking? maybe part of the reason our economy is in so much crap is cause ppl are content with being just middle class

maybe i shouldnt burst ppls bubbles even further by telling ppl that even if they have 6-7m in equity outside of their homes, they are still just middle class nowadays, there is even a term on wall street for these ppls called middle class millionaires... uve only "made it" if u have 10m+ in equity beyond the value of ur home, thats when u have true financial freedom... so i find it extremely funny how even on the forums u got middle class ppl snobbing other middle class folks, when u made it u made it and ppl will know u, ur rep will proceed u and u dont even need to speak for ppl to be envious of u, ppl who need to speak so others will envy are usually still within the middle class range but dont realize it... and there are A LOT of americans like that refusing to admit they are still middle class... so i find it even funnier they look down on FCB's who are technically on the same pay scale...
 
world chaos said:
btw im not understanding this animosity towards FCB's buying in Irvine...
Click to expand...
It's a double-edged sword.

The theory is that they keep prices inflated (so harder for people to buy here) but at the same time... that helps with price retention (if you've bought here, your property value won't drop as much as surrounding cities).
 
While in Irvine it definitely seems like mostly Asian (cough chinese) FCB this isn't something that's specific to Irvine or Chinese people for that matter.
http://online.wsj.com/article/SB10001424052702303901504577460550067846454.html

Affluent people around the world are always looking for safe places to put their money, especially when they don't trust their countries banks/regime/stockmarket/etc.  Within the last few years China had to put laws in place to limit the amount of property foreigners could buy because it was inflating their real estate market too fast for regular folk in China to catch up.  It will be interesting to see how we deal with the situation if the trend continues.
 
In Irvine... FCBs aren't just Chinese... there is large non-Chinese asian demographic in Irvine... and Middle Eastern, Jewish (Israeli?) and Indian.
 
irvinehomeowner said:
In Irvine... FCBs aren't just Chinese... there is large non-Chinese asian demographic in Irvine... and Middle Eastern, Jewish (Israeli?) and Indian.
Click to expand...
I had a Eastern European FCB client so don't forget the Euros too. 
 
yeah ur totally right... now that u mentioned it, theres probably gonna be an influx of french FCB's in the near future if they decide to increase their high income tax to 75% lol...

i just hope this isnt the trend for us as well... my little blue passport is already beginning to feel like a heavy liability especially since neither obama or romney wants to seriously deal with our fiscal cliff... i remember 15 years ago this little blue passport used to be hailed as a luxory... little did i know it would one day become my biggest liability thus far, can only imagine what would happen if our politicians keep kicking the can down the road =_=...

that in itself is also a double edged sword haha... its like either u kick the problem down the road or you keep devaluing the USD to equalize it... its like u lose either way
 
haha no for me its more like jealousy n envy... i really wish i had some sort of dual... oh how heavy thy little bluebook weigheth...
 
lol Bernanke's QE3 =_=... is just gonna make the exchange rate for foreign currency holders even more tempting to buy homes here...

hahaha i can already sense the natives getting restless~

almost makes me feel sorry for the blue collars and wanna join em in chanting "DER TOOK OUR JOBS!!" n now we also need to chant "DER TOOK OUR HOMES!!" ... ROFL
 
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