William Pitt Sotheby's looks to Chinese home buyers
With the economies of China and the U.S. being so closely intertwined, the increasingly wealthy Chinese are eyeing the American real estate market as a good place to invest.
A high-end brokerage with deep roots in Fairfield County is now hoping to lure some of that cash.
William Pitt and Julia B. Fee Sotheby's International Realty has partnered with the online real estate website Caimeiju.com, which focuses on well-heeled Asian consumers, making it the exclusive agent for the real estate firm's offices in Connecticut; Westchester County, N.Y.; and Berkshire County, Mass.
Launched in 2009, Caimeiju.com provides services for U.S. real estate agents, including translation of listings into Chinese and a circulation of listings among real estate associates in China. Caimeiju translates both as "selecting a beautiful residence" and "selecting an American residence."
The website opens Fairfield County up to a new flow of prospective house buyers, said Paul Breunich, president and CEO of William Pitt Sotheby's International Realty, and an association with Caimeiju is helpful because the website operators understand Chinese culture.
"A lot of Americans are very ego-centric in the way they view the world," Breunich said.
By connecting with Caimeiju, his firm shows that it recognizes the importance of the Chinese house buyer to the U.S. economy and the place of the U.S. real estate industry in the global marketplace, according to Breunich. He said the firm should start seeing results soon.
"Manhattan is the financial capital of the world, and our market is 40 to 90 miles from Manhattan," he said, touting the proximity to good private schools.
William Pitt Sotheby's will be selective in posting properties on the website, displaying those that should attract the most attention.
Popular on West Coast
Participating with Caimeiju puts the firm "ahead of the curve" in the region, said William Larkin, brokerage manager of William Pitt Sotheby's International Realty's New Canaan brokerage.
"As a press partner," he said, "Caimeiju will effectively advertise our listings to the Asian-Pacific area, an increasingly important market in today's global real estate marketplace, while simultaneously showcasing properties before Chinese agents based in our own country who utilize the service and share the property information they find there with their clients."
Caimeiju is a well-known marketing tool on the West Coast and other global luxury real estate markets, according to Larkin.
"Many of our agents have expressed a strong desire to achieve greater exposure for their listings before the ever-growing Chinese consumer and luxury classes," Larkin said. "The Asian-Pacific area is an increasingly important market in today's global real estate marketplace and a significant source of qualified purchasers seeking real estate investment opportunities in the United States."
Larkin cited a Wall Street Journal article, which said 6 percent of the ultra-high-net-worth individuals around the world live in China, with only the U.S. ranked higher.
"Attracting this high-net-worth audience is critical to our strategy for 2014 and is part of the reason we decided to work with Caimeiju," he said.
As a marketing partner, Caimeiju advertises William Pitt Sotheby's listings to the Asian-Pacific area, including China's version of YouTube and Twitter and Soufun.com, its leading property portal site.
"We believe that sellers in our markets, always educated and up to date on current real estate trends, will see the value of our ability to achieve exposure in the essential Asian markets," Larkin said, commenting that some Chinese see buying a house in the U.S. as an opportunity to live here and have their children attend an American university, while others consider U.S. real estate as a valuable investment.
Other U.S. real estate firms work with Caimeiju, but William Pitt Sotheby's has exclusive rights in Connecticut; Berkshire County, Mass.; and Westchester County, N.Y., said Jeff Toth, founder and president of Caimeiju, based in Carlsbad, Calif.
"In California, nobody has exclusivity rights. We work with all the luxury real estate companies in other parts of the country," Toth said. "(The website) presents the world's most beautiful properties in a high-level way. It's very selective."
Coldwell Banker connection
While William Pitt Sotheby's has the exclusive rights to this region, national real estate brokerage firm Coldwell Banker also has a relationship with Caimeiju, particularly on the West Coast, said Gregg Wagner, regional vice president of Coldwell Banker in Fairfield and Litchfield counties, based in Ridgefield.
Coldwell Banker has offices in the region that have agents who speak Mandarin, Cantonese and Taiwanese, Wagner said, emphasizing the importance of the company to be involved with Caimeiju.
"You never know where you're going to get your next client," he said. "They (wealthy Chinese) are looking to invest their money in high-end sites."
"Chinese are buying residential and commercial in the U.S., and they're paying cash. There's a lot of money in China, and U.S. real estate is a safe place to put it," said Edelberg. "There aren't a lot of investment vehicles in China. There's concern about a real estate bubble in China. They have a stock market, but it's not mature."
Cheaper than Hong Kong
Some wealthy Chinese prefer to have investments overseas for political reasons, he said.
Prospective buyers from Chinese are known for taking group real estate junkets to the U.S., according to Edelberg, who said lower Fairfield County should draw the interest of Chinese buyers because of its high-end properties and proximity to New York City.
There is significant interest among Chinese in purchasing houses in the United States as second homes and investments, said Katherine Pancak, professor of finance and real estate at the University of Connecticut, citing a National Association of Realtors report showing that 12 percent of all international buyers of houses in the United States are from China.
Housing in the United States is cheaper than in Shanghai and Hong Kong, Pancak said.
"Rights associated with real estate are also stronger in the U.S. than in China," she said. "While Chinese can now own `private' real estate in China, in reality the property right is a 70-year lease. Also, buying a house in China does not come with rights to local government services, such as education. So for wealthy Chinese, it might make more sense to buy a house in the U.S. in a good school district than to pay for private school in China for their children."
While an online affiliation like Caimeiju might impress some house sellers, the majority of houses are sold to a buyer within just 10 miles of a property, said Kent Hanley, executive vice president/general manager of Connecticut sales, William Raveis Real Estate, Mortgage & Insurance in Shelton.
"To me, it's more of a gimmick," he said, adding that Raveis is internationally connected through the Leading Real Estate Companies of the World. "Bill Raveis (company CEO) was in China two years ago talking with real estate agents."
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