Luxury home agent Rex McKown invested $650 in Rosetta Stone discs to learn Chinese.
Irvine broker Alisha Chen opened an office in Taiwan three years ago to capitalize on the growing interest there in Southern California properties.
Kim Chang of Bellflower and other agents say they regularly meet foreign clients jetting into Southern California for three- to seven-day homebuying sprees.
Local agents and Realtors across the U.S. report a marked increase this year in foreign homebuyers shopping for bargains as the housing market bottomed out.
In Orange County and Southern California, Chinese and other Asian buyers – many paying all cash – have snatched up properties as investments, as vacation or retirement homes or as a residence for children studying at local schools or universities, local agents say.
Canadians have been buying winter homes in Arizona and Florida, according to a report by the National Association of Realtors. Wealthy Mexicans and South Americans have been investing in South Florida and Texas.
Foreign buyers spent an estimated $82.4 billion on U.S. homes in the 12 months ending in March, NAR’s most recent survey of U.S. agents shows. That’s up 24 percent from $66.4 billion the year before.
According to the survey, foreign buyers accounted for nearly 5 percent of all U.S. home sales and almost 8 percent of the amount spent.
The National Association of Realtors estimated that foreign buyers accounted for 11 percent of California home sales.
The California Association of Realtors, however, pegged foreign sales at 5.8 percent of the state’s transactions. Of those, 39 percent of the buyers come from China, followed by buyers from Canada (13 percent), and from India and Mexico (8.7 percent each), CAR reported.
The state group doesn’t break down statistics for Orange County. But local agents estimated that the proportion of Orange County and Southern California sales to overseas buyers is higher than the statewide average.
About 20 percent of the buyers at Irvine’s Lambert Ranch development – which caters to Asian buyers with wok kitchens and floor plans for extended families – are from abroad, said Joan Marcus-Colvin, senior vice president at the New Home Co.
Local agents specialized in working with foreign buyers say they see strong interest among affluent shoppers in China, Taiwan, India and other Asian countries.
“I think they’ll keep coming as long as the Chinese government allows them to wire the money out because people there have so much money,” said Cayenne Kuang, broker and owner of Spectrum Realty in Irvine.
Luxury home agents report a rise in foreign home shoppers at home viewings.
McKown, an agent for Surterre Properties, said foreign shoppers account for 80 percent of the viewings, up from 20 percent eight months ago. Jacqueline Thompson, also of Surterre, says Chinese make up about half of the buyers at home showings.
“I think the Chinese realized the urgency to buy up homes in the U.S. because they see that prices will increase,” Thompson said. “They’re beginning to realize the U.S. is a safe haven to park their money in real estate.”
McKown reported also that foreign buyers purchased seven of 12 homes that sold for $6 million or more this year in Crystal Cove and Newport Coast. Two buyers came from China, two from Saudi Arabia, two from India and one from Japan, he said.
Many foreign buyers are looking for an investment, buying homes to rent out or to live in part time during business trips to the U.S., agents say.
Christina Shaw, who heads the international division of RE/MAX Fine Homes in Newport Beach, noted that foreign buyers feel at home in Southern California because of the moderate climate and the proximity to familiar restaurants, grocery stores and shopping.
“Even if they don’t speak English, they can get around,” said Shaw, who recently met with potential clients in Beijing and Shanghai.
Several agents had clients who bought large, two-story luxury homes in new developments for their children studying at local universities.
The parents may stay there when they visit the U.S., but Century 21 agent Kim Chang of Bellflower said: “You’d be surprised by the number of families that buy homes for the children and the children live here by themselves.”
In China, local agents said, home purchases don’t include the land, which is leased from the government. In Orange County, Chinese buyers get much more home for the money, and it includes the land.
Irvine and the San Gabriel Valley city of Arcadia are two of the most popular destinations for Chinese homebuyers, said Chang, with prices typically ranging from $750,000 to $1 million.
Anaheim Hills, Buena Park, La Palma and Tustin also are popular. Foreign buyers “think the United States is the most safe place for investments, especially for real estate because we have the most laws for protection (of property),” Chang said.
Alisha Chen, broker for Cornerstone Real Estate International in Irvine, has seen her business grow steadily since she opened a satellite office on the outskirts of Taipei, Taiwan, three years ago.
She visits the country at least once a year to give seminars on buying property in the U.S., sometimes drawing buyers from China and Hong Kong.
Chen said she not only finds deals for overseas investors, but also repairs and remodels the homes they buy and rents them out.
Her three-office brokerage currently manages 35 to 40 Southern California properties for overseas investors.
Inland Empire economist John Husing worries, however, that investors – whether from Kansas or Asia – are competing with local residents wanting to buy homes for their families.
“I’ve had any number of young people unable to buy a house,” Husing said. “They were outbid by people buying to rent them.”
Eric Sussman, a senior lecturer at the UCLA Anderson School of Management, said that while foreign investors compete with domestic buyers, driving up home prices, “they’re marginal increases. It’s not a big spike.”
Chang, the Bellflower agent, noted that there’s much more to selling to overseas buyers than to domestic home shoppers.
“For foreign buyers, you have to not only be a Realtor, you have to be the best of friends. You have to be a tour guide,” she said. “You have to be everything.”
Register staff writer Kelli Hart Kehler contributed to this report.