Is this What Hit Housing in San Francisco, Manhattan, and Miami? Suddenly, Foreign Investors Pull...

[marmar]

Is this What Hit Housing in San Francisco, Manhattan, and Miami? Suddenly, Foreign Investors Pull Back…
by Wolf Richter • July 7, 2016


[font color="blue"]Chinese investors buy fewer homes in the US.[/font]

Oh no, we thought when we read the report from the National Association of Realtors. Not now! Not when there’s a huge unstoppable condo glut building up in the teetering housing markets of San Francisco, Manhattan, and Miami, when sales and prices are already dropping. Foreign investors are now needed more than ever to absorb this new high-end inventory and bail out these markets.

That’s what everyone has been praying for. The last thing we need is for Chinese investors to stay away from San Francisco and Manhattan; and Canadian, European, and Latin American investors to stay away from Miami.

But that’s what they’re starting to do – for the first time since the Financial Crisis.

The data for the just released NAR report is based on a survey of 5,960 realtors that covered “transactions with international clients during the 12-month period between April 2015 and March 2016.

.....(snip).....

But San Francisco, Miami, and Manhattan are steeped in an epic condo glut. New high-rise developments are hitting the market, and those still in the pipeline will hit the market this year and over the next few years. Developments where construction has already begun can no longer be stopped without huge losses. They were planned in good times. And now the tide has turned.

It’s already happening. Condo prices in Manhattan, as new high-end developments flood the market, have tumbled 14% in three months. .............(more)

http://wolfstreet.com/2016/07/07/foreign-investors-chinese-pull-back-from-housing-in-san-francisco-manhattan-miami/

[Ohioblue22]

1. Affordable housing is good isn't it?

[Warpy]

7. None of this will ever be affordable housing

It's high ticket, glossy, glitzy, and palatial, fit for the top executive class and above who are looking for endlessly appreciating property that someday might provide a comfortably bolt hole. There's no way it can be retrofitted for ordinary families. If the ultra wealthy stop buying, much of it will have to be torn down.

Little affordable housing is being built because builders are dazzled by the high profit margins on the glitzy towers.

[TDale313]

2. Housing prices in the Bay Area are stupid high.

They need to come down. Even rent is getting out of reach unless you have a six figure income. Time for the housing bubble to burst a bit. It's still a wonderful area and housing will always be high cause people wanna be here, but this? This is ridiculous.

[still_one]

5. I agree, but even if prices dropped due to this effect, there is very little chance that they

will drop low enough to what would be considered affordable.

That is why a good number are commuting into the Bay Area from Stockton, Tracy, etc. where housing is more affordable, but the commute is no fun, and mass transit has been stagnant for decades.

[tonyt53]

3. They are backing off because the asking prices were rising far too quickly.

Those people buying have lots of money, but they aren't suckers.

[still_one]

4. It sure isn't noticeable here in the bay area where prices are too expensive. Even if

prices were affected adversely by foreign investment as suggested, there is very little chance that the prices would drop low enough to what would be considered affordable

[kimbutgar]

6. There are a lot of empty units in San Francisco because foreign investors buying condos

And not renting them out. Or buying buildings and throwing out long time renters.