International real estate activities during coronavirus crisis
The continual spread of coronavirus has caused a huge global economic impact across all industries. As every nation, and every individual is working their best to contain this spread and protect the economy, we would like to do our part to share some insights of the international real estate market to help agents’ weather through this crisis.
Short term impact: Transactions decline, online activities surge
Everything in China has come to a halt. Everyone is occupied with the crisis. To most Chinese, stepping out of home to the grocers is already challenging, and buying international real estate may be at the bottom of their to-do list. Travel ban also means that buyers are unable to physically be present in the country to close transactions. So yes, in markets where Chinese property buyers make up a significant amount of the transaction, it is no surprise that transactions have declined.
Interestingly, we noticed a 3x increase of properties enquiries from China over the last 6 weeks. In most parts of China, people are either working from home, or spending more time at home after work as social and outdoor activities are not encouraged. This means it is the best time to couch surf, browse for international property, discuss family asset planning and future overseas education opportunities with their spouse and kids.
We observed 3 significant type of enquires:
- First is still the all-time favourite countries like US, Canada, Australia.
These countries have a long history of migration, a good educational system and a stable economy. Even though sales from Chinese buyers have decreased over the last 18 months due to reasons like policy changes and capital controls, consumers are still showing strong interest in these markets. Nothing significant about the outbreak was mentioned, but we do have a handful of them asking if there were racism and xenophobia in these countries due to this outbreak.
- Second type is interestingly directed at countries that are completely out of the foreign investors radar like Estonia, Romania, Morocco, Bulgaria, Latvia, Serbia.
A key reason for this may be that the prices are significantly less expensive, opening up a whole new world to Chinese buyers who now have more time to do online research. It may be too early to comment if there will be a surge in transactions in these countries after the outbreak, but it certainly has caught the attention of Chinese consumers.
- Third type of enquiry is pointed towards countries that offers citizenship or residencies for passive investment in real estate or government bonds.
Countries like Portugal, Spain, Turkey, Ireland & Greece continues to top the list. Again, there was no specific mentioned on the outbreak in the enquiries, but the interest has spiked significantly in the last 6 weeks.
Long term impact: Pent up activities due to delayed transaction, more reasons to have a second home
While we are still uncertain when the coronavirus will be under control, once it is, understandably, there will be a huge surge in transactions, as buyers complete delayed purchases. At the same time, we believe that the interest to own a second home or have alternative citizenship will grow significantly higher post-coronavirus and it will not come only from China, but from across the globe. Holding multiple residencies, regardless a natural or man-made disaster, does gives peace of mind knowing that one has a few places to call home.
Finally, while we work together to battle this epidemic, for real estate business who are taking the hit, the best suggestion we can give is to be consistent and persistent in your marketing campaign. Continue to educate the international audiences about your market. As our data already shows, interest is coming from various perspectives. Let’s use this time to prepare ourselves when the market bounces back.
Collaboration article — About the Author
Esther Yong is the Director and Co-founder of ACproperty.com.au, Australia’s no.1 Chinese language property portal. ACproperty is currently working alongside ListGlobally providing Chinese market solution to ListGlobally clients around the world.
To stay in the forefront of real estate, you must work with a foreign audience. You need to take the best tools available on the market to optimize time (for you and your customers).
ListGlobally is the world’s largest network of property portals reaching +200M foreign buyers in +60 countries. One click, and your property is promoted all over the globe reaching an international audience. We offer real estate agents international exposure, and we translate their listings details into 25 languages.