Guest Post

The Story Behind The Numbers

Chinese Investment In Massachusetts’s Housing Market



For the first time, The Warren Group has partnered with GeoHome to analyze the firm’s real estate data to determine where Chinese investors are buying in Massachusetts – and what they’re buying when they do.

More and more Chinese want to buy houses to invest, a trend similar to Japanese buyers in the 1980s. GeoHome ran an analysis to understand the Chinese buyer’s preference – where and what did they buy?

Chinese homebuyers in Massachusetts tend to buy properties that are less expensive than Chinese buyers in other U.S. states. The median price of properties bought by Chinese buyers is $330,000 in Massachusetts overall and $430,000 in the Greater Boston area; both are lower than the median price – $523,148 – of U.S. properties bought by Chinese buyers. The median property value in Greater Boston area is around $477,000, which is higher than the median price of purchases by Chinese buyers. As for the dramatic story in the media about Chinese buyers buying million-dollar properties with cash, the latter part is true, since it’s hard for Chinese buyers to get loans in the U.S., but the first part only tells half of the story. More Chinese commoners are coming and snapping lower-end properties recently.

From January 2012 to September 2015, Chinese buyers have bought over 4,000 residential properties in Massachusetts, which is only 1.4 percent of total residential property transactions in the same period. In the Boston Metropolitan area (Boston, Cambridge, Quincy and surrounding suburban area), the percentage is about 2.8 percent by count.

MAAll

 

Chinese buyers significantly prefer city and suburban properties, and are not as interested in rural districts.

Chinese buyers prefer condominiums and are less interested in single-family homes. This pattern persists for city, suburban and rural areas.

Chinese buyers strongly prefer properties at opposite ends of the cost spectrum. For single-family, suburban houses lower than $250,000 or higher than $900,000, rural houses lower than $150,000 or higher than $700,000, especially over $1.5 million, attract disproportionately Chinese buyers.

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In Boston, non-single family properties less than $750,000 are more likely to attract Chinese buyers. In suburban areas, the threshold is less than $300,000.

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Towns with a high percentage of current Chinese residents attract more Chinese buyers. Quincy, in particular, is preferred by Chinese buyers whose last names are Chen or Lin; people with these two last names are geographically clustered in China’s southeast shore (Fujian and Zhejiang provinces). Other popular towns for Chinese buyers include Cambridge, Boston, Belmont, Brookline, Malden, Newton, Brighton, Lexington and Lowell.

Xiaowen Yang is cofounder and CEO of GeoHome, a big data company for real estate. She can be reached at xiaoweny@geohomeusa.com or (617) 431-8416.

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For more information about The Warren Group’s data products and services, contact David Lovins at dlovins@thewarrengroup.com.



The Story Behind The Numbers

by Cassidy Murphy time to read: 2 min
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