Seattle: Is it Vancouver Déjà Vu?
The popular West Coast cities of San Francisco, Los Angeles and Vancouver have long been the most direct routes to New World prosperity for Asian immigrants and their families. Now that generations of Chinese buyers have transitioned to life in North America, their experience and trend spotting is bringing to bear more practical considerations of economic fundamentals, financial and educational opportunities, and overall quality of life. So it’s no surprise that relative affordability, propensity for capital appreciation and even a recently imposed 15-percent foreign homebuyer tax in Vancouver, are boosting interest in alternative markets like Seattle—the next international gateway city on the rise.
Matthew Moore, President of the Americas for Juwai.com, a popular residential real estate search portal in China, noted significant changes: “Juwai.com buying enquiries to Seattle increased by 143 percent in August 2016, compared to one year earlier. Meanwhile buying enquiries to Vancouver dropped by 81 percent during the same period, with all of that drop concentrated in the premium end of the market.”
The forested mountains and deep blue waters of Puget Sound, together with high-quality schools, a vibrant and diversified economy, and absence of a state income tax (unlike California) have drawn a gathering surge of Chinese buyers to the Greater Seattle region in recent years. Somewhat overlooked by past generations of immigrants in comparison with Vancouver BC and San Francisco, the Pacific Northwest has so far avoided the trap of high growth fueled by non-resident real estate investment. Yet, industry experts believe that’s coming and likely part of the draw. To the trained eye, Seattle, and especially Bellevue, is looking more and more like Vancouver, albeit about twenty years its junior.
A Canadian and former resident of Vancouver, Dean Jones, President and CEO of Seattle-based Realogics Sotheby’s International Realty, sees familiar signs. His company actively promotes local properties to immigrating Chinese and other Asian buyers with the deployment of an exclusive WeChat portal and establishment of their Asia Services Group, a collective of real estate advisors specialized in the language and logistics of foreign buyers. Jones is also on the Board of Directors for the Washington State China Relations Council and says the region is bracing for a wave of foreign direct investment.
“History may be repeating itself south of the Canadian border,” said Jones referring to Vancouver’s global arrival over the past two decades. “Savvy investors recognize the opportunity as do other stakeholders from Chinese developers to Chinese airlines—everyone agrees the Seattle area is fundamentally well-positioned. Fortunately, overseas demand is on top of our domestic housing drivers like job growth, increased population and wealth generation. The Pacific Northwest already leads the nation with median home price increases and rent growth.”
Unlike Vancouver, the housing market in Puget Sound region is not buoyed by immigration or foreign direct investment. Instead it has steadily lured productive capital investment in its own knowledge-intensive local businesses. Home to Microsoft, Amazon, and Expedia, and now with a large contingent of staff for Google, Facebook and a recently announced expansion by Apple and China-based Alibaba, Seattle has steadily augmented its high-tech eminence since the 1980s. These high-paying jobs draw a growing and well-paid workforce.