<p><img alt="" src="/documents/10204/0/us-investment-feature-lead-compressor.jpg/d0634aed-974e-425f-8391-169a2815b010?t=1530701233578" style="width: 1400px; height: 640px;" />While its glitzy allure and air of unshakeable confidence may be one of the sticks critics of the United States use to beat it with, there’s no denying the widescreen appeal of the world’s preeminent superpower. Investors have long eyed its cities in the hope of snaring their own tangible piece of the American Dream. And when you look at the evidence, it’s impossible to blame them.</p> <p>In Miami, plentiful sunshine and golden beaches are among the drawcards. New York creates its own legends, and high-rise apartments overlooking Central Park are among the most sought after real estate on the planet. And, of course, there’s countless others, including Los Angeles with its timeless Hollywood quality and San Francisco and Seattle: two perennial stars on the nation’s western seaboard.</p> <p>Indeed, US cities have long offered potential property buyers both prestige and impressive returns, with the high-end market even surviving the calamitous financial crash that shook the world a decade ago.</p> <p>Although premium real estate in the United States has remained a relatively safe investment – at least for those who can afford and properly finance a purchase – there has been a notable change on the buyer side, as increased globalisation brings investors from different parts of the world.</p> <p>As is so often the case these days, much of this interest comes from China. In 2016, Chinese outbound real estate investments increased by 56 percent, reaching a record USD28.2 billion.&nbsp;China&nbsp;also became&nbsp;the largest&nbsp;global cross-border real estate investor, overtaking the United States.</p> <p>This historic high led to tightened capital controls, implemented by Chinese State Control in late 2016 as authorities sought to stem capital flight amid fears of currency depreciation. Investment in luxury property abroad subsequently experienced a slowdown in early 2017 but, interest from Chinese buyers was once again on the up again by the close of the year.&nbsp;&nbsp;</p> <p><img alt="San Francisco is widely known for its accessibility, infrastructure, and highly educated populace, factors that are a proven hit with investors" src="/documents/10204/0/us-investment-feature-4-compressor.jpg/a9ba371e-dd2f-4619-9697-04dafb0dae23?t=1530701832719" /></p> <p>Enquiries about high-end purchases abroad have remained strong throughout 2017, Byron Burley, head of North America at Chinese international property website Juwai, says. The combination of positive market trends and openness to foreign investment, plus its top status in sectors such as education, culture and tourism, means the US remains the first choice for many.</p> <p>“US property is a less volatile investment than securities, gold, or even cash,” he says. “In luxury destinations, prices are more resilient and likely to bounce back from any downturn because there are only so many top locations in the world. Investors can simply wait out down markets and continue to occupy or generate revenue from their property in the meantime.”</p> <p>Luxury real estate has morphed into a new world currency, according to Jonathan Miller, CEO of Miller Samuel, a residential real estate consulting company covering the New York metro area.</p> <p><a href="http://property-report.com/detail/-/blogs/you-can-now-own-this-star-studded-american-estate-with-2m-in-landscaping" target="_blank"><strong>More:&nbsp;You can now own this star-studded American estate</strong></a></p> <p>“It provides investors with a tangible asset and a cachet that cannot be found within the financial markets. It’s as if emboldened investors zoomed out of their local Google Earth view to discover the wider global perspective on luxury real estate.”</p> <p>Miller asserts that it has been the upsurge in international investor interest in the US that has helped its luxury housing market recover from the 2008 crash, from which it suffered major collateral damage. &nbsp;</p> <p>“Even as the dollar has strengthened in recent years, it did not appear to weaken demand from international buyers,” he says. “The trophy property has become a new market category that does not follow the rules and dynamics of the overall marketplace.”</p> <div class="pull-quotes-container">Many Chinese believe that the Trump brand represents the fulfilment of the American Dream through savvy investments and success in real estate trading</div> <p>The narrative of Asian investment in US luxury property, however, defies easy categorisation. While seen as an aberration by many – especially those of a liberal bent – the presidency of US commander in chief Donald Trump has boosted Chinese interest in US real estate. A report by Juwai published in late 2017 found that many Chinese believe that the Trump brand represents the fulfilment of the American Dream through savvy investments and success in real estate trading.</p> <p>Legislation passed under Trump has not yet affected property investors from abroad. The EB-5 programme, which grants US green cards to foreigners who park their cash in investments of at least USD500,000 – and has been so popular in Asia it is referred to as the “golden visa” – was set to expire at the end of September but was given a reprieve by Congress. At the time of writing, its future is still to be decided.</p> <p>Juwai’s Burley says many of his clients make general enquiries before getting down to the nitty-gritty. “Our high-net-worth investors often start property hunting before they even know where they want to buy. They tell us things like, ‘I’d like a USD15 million home in Manhattan, Los Angeles, or Miami. What are my options?’ These buyers are looking for the best combination of lifestyle and long-term investment quality.</p> <p>“But in some ways, investors in all these cities have the same motivations of lifestyle, wealth protection, and education. Los Angeles is closer to China and has its unique California characteristics. Miami offers lower prices and beachfront towers with ocean views, while New York offers glamorous city living.”</p> <p><a href="http://property-report.com/detail/-/blogs/why-southeast-asia-is-still-prime-quarry-for-chinese-investors" target="_blank"><strong>More:&nbsp;Southeast Asia is still a prime target for Chinese property investors</strong></a></p> <p>Indeed, you don’t need to delve too deeply for attractive selling factors in many of the US investment hotspots. &nbsp;Los Angeles beat out London as the new hot spot for global real estate investors in the third annual Schroders Global Cities 30 Index, released in June 2017. Its success was attributed to well respected colleges such as UCLA and Pepperdine and start-up tech companies such as Snapchat and Pandora, as well as its promise of a gilded Californian lifestyle.</p> <p>Also on the rise was Boston, due to its proximity to top Ivy League colleges such as Harvard and Yale, and Chicago, which defied headlines about inner-city crime to jump to fourth place in the list. Emphasising US pre-eminence as an investment hotspot was the fact that its cities took 18 of the top 30 spots on the index.</p> <p>The huge Asian diaspora in US cities is also a major factor, fuelling interest from buyers looking for a community-rich location where they will be able to settle in easier and make connections.</p> <p><img alt="With its warm Californian climate and movie-star allure, Los Angeles has become a huge favourite for overseas investors in real estate" src="/documents/10204/0/us-investment-feature-2-compressor.jpg/314d0546-fb4d-445e-a3a1-337ffd0df0e4?t=1530702224111" /></p> <p>Some high-end investors buy property purely for future financial yield, but many buyers are looking for property for specific reasons. These include migrants moving for work, parents investing in property for children who are studying in the US and retirees looking for a second home abroad.</p> <p>And the better a city’s infrastructure, technological assets, and accessibility, the more appeal it has. A report by Savills, looking at the top ‘Tech Cities’ worldwide in 2017, studied hundreds of factors, from how talent-rich a city is, to the price of a latte, and grouped these metrics into categories including ‘Business Environment’ and ‘City Buzz and Wellness’. New York City, Seattle and San Francisco all feature in the top 20.</p> <p>So once buyers decide on a location, be it for work, study or leisure, what kind of accommodation are they looking for? Jeanette Rice, CBRE’s head of multifamily research for the Americas, says that in the urban cores, both mid-rise and high-rise are popular.</p> <p><img alt="Another US city that is famous for its good weather and high living quality is Miami" src="/documents/10204/0/us-investment-feature-3-compressor.jpg/030b775d-f2ed-4c72-95a9-6ec363995e07?t=1530702163715" /></p> <p>“There’s been a lot of new supply added in the past few years – too much to be quickly absorbed,” she adds. “Demand is also very good for the newer product being built in the suburbs, but most of it is being built for relatively young, well-paid professionals, often single and often without children.”</p> <p>With an increase in real estate prices, and space at a premium in prime areas such as Manhattan, Miami’s South Beach and around Silicon Valley in California, the make-up – and the layout – of US cities has altered considerably.</p> <div class="pull-quotes-container">The top cities may well remain such, but there are other destinations that have high momentum with Asian buyers</div> <p>While there are many who bemoan the gentrification and disintegration of long standing communities, as well as the often massive hikes in property prices, the counter-argument goes that cities in the US have become safer, more appealing places overall to invest in property.</p> <p>“Centres of gentrification such as Williamsburg and Long Island in New York and SoMa in San Francisco offer lots of new developments and are highly appealing to younger households,” Rice says.</p> <p><a href="http://property-report.com/detail/-/blogs/grey-gardens-finally-sold-for-15--1" target="_blank"><strong>More:&nbsp;Grey Gardens finally sells for $15.5m</strong></a></p> <p>As the geography of cities changes, and real estate space becomes tight, it seems buyers have started to increasingly turn to secondary markets.</p> <p>“The top cities may well remain such, but there are other destinations that have high momentum with Asian buyers,” Byron says. “San Diego, Chicago and Atlanta are all examples of cities with solid growth in Chinese buyer inquiries in the third quarter of 2017. Savvy investors are already eyeing up property in these up and coming locations.”</p> <p>As global power appears to shift towards Asia, US preoccupation with its seemingly dwindling status and how to regain its mojo looks likely to be one of the chief narratives of our time. However, when it comes to luring rich foreigners to its cities, its seems little effort is needed in making investors heed the call of Uncle Sam.</p> <p><em>This article originally appeared in <a href="https://www.magzter.com/TH/PropertyGuru-International-(Thailand)-Co.,Ltd/Property-Report/Business/266502" target="_blank">Issue No. 146 of PropertyGuru Property Report Magazine</a>&nbsp;&nbsp;</em></p>

<p><img alt="ESB Professional/Shutterstock" src="/documents/10204/0/hong-kong-dispatch-147-for-magazine-compressor.jpg/f8551ff9-c3fc-4032-ae2e-03ba2a91ad40?t=1530244787978" style="width: 1400px; height: 640px;" />It was supposed to be a quick fix. Six years, a few shadowy decisions and a lot of uncomfortable questions later, the Hong Kong government may rue the day it added the Wang Chau housing project to its docket. An HKD2.4 billion (USD306 million) development now lies in limbo, a threat to evict hundreds of villagers has captured public sympathy, and a classic David vs Goliath saga has blown wind into the sails of a pro-democratic politician as the semi-autonomous region grapples with China’s growing influence.</p> <p>Hong Kong is one of Asia’s great financial centres and an attractive place to live, as the former British colony offers a far more liberal economy and lifestyle than its giant communist overlord. But 7.3 million people call the small territory home and it’s running out of room. It’s also one of the world’s most expensive cities, and real estate experts warn that locals are being priced out amid rising mortgage rates and demand from Mainland Chinese buyers.</p> <p>“The private market is so expensive that many low-income households cannot afford even to rent in the private sector,” says Victor Li Jing, a professor of geography at the Chinese University of Hong Kong and an expert on housing policy. Hong Kongers wait about four years on average to qualify for public housing, he says, “so it’s really necessary to increase supply.” The biggest problem is simply that there’s little land left to build on.</p> <p>The Wang Chau development seemed like a good enough solution at the time. A 2012 study commissioned by Hong Kong’s Housing Authority found that three sites in the rural New Territories could be feasibly transformed into apartments. The plan called for converting a greenbelt site (undeveloped natural land) and two brownfields (former industrial sites that have mostly fallen into disuse) into residential properties. But in the years since, the project has hit one speed bump after another – and the more scrutiny it drew, the messier it looked.</p> <p><a href="http://property-report.com/detail/-/blogs/cooling-measures-in-hong-kong-and-singapore-what-works-what-doesn-6" target="_blank"><strong>More:&nbsp;What cooling measures work in Hong Kong and Singapore?</strong></a></p> <p>First came the downsizing. Initially billed as a quick way to create 17,000 affordable homes on mostly unused land, the government was willing to sacrifice three “non-indigenous” villages on a greenbelt site – one of many natural oases that are a source a pride for Hong Kong – for the greater good. Eyebrows were raised when it was later revealed that a series of informal meetings between powerful officials and rural strongmen, of which there are no public records, resulted in the government shelving the brownfield developments and reducing the project’s yield to a mere 4,000 units.</p> <p>Then came the eviction notices. When roughly 200 villagers awoke one morning in September 2015 to an order to clear out with little or no compensation, the deal began to look less sweet. Ordinarily, says Li Jing, it’s preferable to prioritise developing brownfields, for the obvious reasons that no one lives on them and it entails restoring a damaged environment instead of disrupting a natural one. “The initial costs of brownfield development may be higher,” he says, “but if you look at the social and environmental benefits it’s better to develop the brownfields first.”</p> <div class="pull-quotes-container">THIS ISN’T ABOUT STOPPING A PUBLIC HOUSING DEVELOPMENT — IT’S ABOUT PRIORITIES. IT’S ABOUT MAKING GOOD CHOICES FROM THE POINT OF VIEW OF WELFARE</div> <p>The arrangement didn’t quite add up. To the chagrin of the administration then led by former chief executive Leung Chun-ying, it caught the attention of land rights activist Eddie Chu Hoi-dick, who was preparing to run for office. Chu accused the Hong Kong government of colluding with crony landowners and triads on a deal that would let them keep the brownfields, where one rural strongman reportedly runs a lucrative car park, and instead develop the greenbelt, where poor people lived.</p> <p>After organising protests that ultimately delayed the evictions, Chu was dubbed “the King of Votes” for his record support in legislative elections. “When the backdoor lobbying was exposed, everyone opposed it,” Chu recalls. “This isn’t about stopping a public housing development — it’s about priorities. It’s about making good choices from the point of view of welfare.”</p> <p>The housing crisis thus proved to be the newest fault line in Hong Kong’s divided politics. In its reduced form, the Wang Chau project has already been approved, albeit after being tucked neatly into an all-or-nothing spending package alongside more than 9,400 items last year, but persistent opposition has left it temporarily stalled. Chu sees the potential for a watershed moment. On the one hand, public outcry could force the government to adopt more people-centred policies.</p> <p><a href="http://property-report.com/detail/-/blogs/what-homes-you-can-get-for-your-money-in-bangkok-and-hong-ko-1" target="_blank"><strong>More:&nbsp;Should you invest in luxury Bangkok digs or a basic Hong Kong apartment?</strong></a></p> <p>On the other, a refusal to adapt to the public’s concerns would shatter the illusion of democracy in Hong Kong. “This is our best chance to make progress because of the amount of public pressure,” Chu says, “but if this carries on without any changes, people will feel very demoralised — they may just give up.”</p> <p>David Ji, director and head of research &amp; consultancy for greater China at Knight Frank, says the Hong Kong government “has restated its determination to increase public housing supply.”</p> <p>Nonetheless, he says that despite pledging to build some 280,000 units over the next decade, its policies are “not effective in limiting price growth, [they’re] not even able to buy more time” for supply to come online.</p> <p>Carrie Lam, Hong Kong’s new chief executive, said during her debut policy address that solving the housing crisis was a “priority livelihood issue” for her administration, and it may the biggest test she will face. Watch where she sends the bulldozers to see where her priorities lie.</p> <p><em>This article originally appeared in <a href="https://www.magzter.com/TH/PropertyGuru-International-(Thailand)-Co.,Ltd/Property-Report/Business/275915" target="_blank">Issue No. 147 of PropertyGuru Property Report Magazine</a></em></p>