A Chinese-Driven “Real Estate Boom” in Seattle? No.

Interesting article in the New York Times yesterday: In Suburban Seattle, New Nests for China’s Rich

…increasingly, China’s rich are also offshoring their families along with their cash. That’s created a real estate boom in an unlikely corner of the United States: suburban Seattle.

Wealthy Chinese have become far and away the biggest foreign buyers of real estate in Seattle in recent years, accounting for up to one-third of $1-million-plus homes sold in certain areas, brokers say. Seattle real estate agents are hiring Mandarin speakers and even opening offices in Beijing. Builders are designing much of their new construction for Chinese buyers.

That’s made Seattle one of the world’s top catch basins for the billions of dollars spilling out of China every year. While foreign money has also been pouring into New York, Los Angeles and London real estate, the impact of the Chinese rich on Seattle is far more concentrated, focused on a few small, upscale suburbs. They’re especially attracted to Medina — home to Bill Gates and Jeff Bezos — and the West Bellevue area. “The first question you often hear from Chinese clients is ‘Where does Bill Gates live?'” said Moya Skillman, a broker with Windermere Real Estate.

Brokers and analysts say 20 to 40 percent of $1 million-plus homes sold on the Eastside — a collective term for eastern suburbs of Seattle — were purchased by Chinese buyers.

A $1.1 million listing in West Bellevue recently attracted 24 bidders, virtually all of them Chinese, and the home quickly sold for $1.4 million. Ms. Wan said a $2.5 million lakefront property recently sold with three offers, just days after coming onto the market.

There are a lot of anecdotes in the story, while the only data they cite is the “20 to 40 percent” number from “brokers and analysts.” I’d be interested to know more about exactly how they’re defining that and where they’re getting the data from.

Here’s some data I pulled on single-family sales volume over the last three months in King County and across some of the popular upscale eastside zip codes.

zip code area sales $1M+ sales % $1M+
98039 Medina 17 16 94%
98004 West Bellevue 82 54 66%
98005 East Bellevue 44 8 18%
98007 East Bellevue 36 2 6%
98008 West Lake Sammamish 82 7 9%
98074 Sammamish 161 13 8%
98075 East Lake Sammamish 150 27 18%
Subtotal 572 127 22%
All of King County 6,420 502 8%

So taking the high end of the “20 to 40 percent” estimate, we’re talking about around 50 sales in the last three months, out of 6,400 county-wide—0.8 percent of all sales.

The story is certainly interesting, but I’d hardly call it a trend that’s likely to affect many homebuyers in the Seattle area.

I did like this part though:

Their attraction to Seattle stems from its top schools, clean air, longtime Chinese population and, more recently, a hit movie. The 2013 film “Beijing Meets Seattle” (or “Finding Mr. Right” in English) became one of China’s top-grossing films of all time, telling the story of a pregnant woman who flies to Seattle to find true love and American citizenship for her baby. The film struck a chord with younger Chinese, who saw Seattle as a liberating, romantic escape from the intense materialism of China (even though much of the movie was filmed in Vancouver).

“People my age in China suddenly started talking about Seattle,” said Bangze Wang, a Beijing native who now lives in Seattle.

I fully expect the movie to be fairly terrible, but I kind of want to see it now. Anyone up for a viewing party?

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About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market. Tim also hosts the weekly improv comedy sci-fi podcast Dispatches from the Multiverse.


  1. 1
    wreckingbull says:

    Of course this is an anecdote, but my parents sold their long-time Eastside home a few years back to a Chinese buyer. He escalated a bidding war and never flinched at the price. Full cash purchase.

    His story during the negotiations was that he was a high-tech executive and needed the house so his children could attend school, to be accompanied by his wife. After he bought it, he flipped it; the story was likely a ruse.

    He never set foot in the place, even after the purchase.

  2. 2

    Our MSM Likes to Brag About All the Rich Chinese Investors Wanting American Real Estate to Emigrate To

    Then when you blog rich Chinese can’t get out of China; the You Tube is your best news source [they agree with me too]. To leave China, a foreign tourist cannot take more than $10K out of the country [than they brought in] and in a country like China where land ownership is illegal [you can only rent the land], I’d bet dollars to doughnuts any emigrants coming to Seattle put their life on the line trying to do it, especially illegally sneaking lots of cash with them too.

    Its still a Communist country you know.

  3. 3
    Blake says:

    By softwarengineer @ 2:

    Its still a Communist country you know.

    More accurately: China is still ruled by the Communnist Party, but it is not a communist country. Their crony capitalist nomenklatura class puts ours to shame… at least their people are protesting int he streets ands their courts are prosecuting (and executing) some of the worst offenders!

  4. 4
    redmondjp says:

    I would agree that foreign investers aren’t fueling the boom, but they are certainly a part of it. I bought a garden tractor from a person in a high-end neighborhood in Sammamish this summer who sold their house (property taxes were $24K per year), most likely to an off-shore invester. The house was listed on Friday, and Saturday morning an agent came over and spent over two hours photographing everything. They had an all-cash offer that evening (which they accepted), with the new buyers never having set foot on the property.

    We are not the only market in which this is taking place. Apparently in Miami the same thing is happening, with money from South America (The Housing Bubble Blog has been discussing this lately).

    If these are flight-to-safety buyers, then they are more likely concerned about asset preservation than about making a short-term profit. So if the market takes a downturn, these properties may not necessarily come back onto the market in high numbers, especially considering that there are no mortgages on most of them.

    Everbody is trying to find a safe haven for their assets, which is not a new phenomenon by any means. It is frustrating, however, for local buyers that simply want to live here. I wonder how many of the foreign-owned properties will actually be lived in?

    Interesting times that we live in, that’s for sure!

  5. 5
    Eastsider says:

    “So taking the high end of the “20 to 40 percent” estimate, we’re talking about around 50 sales in the last three months, out of 6,400 county-wide—0.8 percent of all sales.”

    The article did not give any estimate on sub-million property sales to the Chinese so I am not sure what your point is? In the city of Bellevue, Chinese buyers can easily account for 10% of sales in SFH’s. If you have tried to buy a property in desirable Bellevue neighborhoods in the past two years, you will witness the tremendous competition from foreign cash buyers first hand.

  6. 6

    Tim wrote: “There are a lot of anecdotes in the story, while the only data they cite is the “20 to 40 percent” number from “brokers and analysts.”

    Hey, it’s brokers AND analysts! How much more proof do you want? ;-)

    Seriously, it’s good to be skeptical of such nonsense. Unless you actually talked to either the buyer’s agent or the escrow (signer) on each $1M+ transaction, there would be no way at all to gather that data. Sad when even the NY Times resorts to such reporting.

    As an aside, there are a fair number of Krismers who are Asian. So you can’t even rule out certain transactions by the name. You would need to check every transaction.

  7. 7
    Mike says:

    RE: Eastsider @ 5 – That doesn’t necessarily mean they’re Chinese Nationals.

    One of the local papers did a story on this not long ago and found the actual number of verified foreign sales in King County was in the range of 100 properties in the previous year.

  8. 8
    Eastsider says:

    RE: Mike @ 7

    True, they are not necessarily from mainland China. They can be from Taiwan, Hong Kong, Canada, or out of state.

  9. 9
    boater says:

    The house at the start of out block fits this story to a tee. Bought by a Chinese national via a Chinese broker sight unseen as an asset preservation scheme. Purchase price was $1.1 m. He rents it out. I found out all the info from the selling agent. I doubt there are a ton of them but they exist and they impact prices.

  10. 10
    ChrisM says:

    I rented a property a few years ago that was owned by a Chinese couple in a failed flip. I then rented a property from an American couple in another failed flip…

  11. 11
    One Eyed Man says:

    Perhaps the anecdotal increase in Seattle area high end Chinese buyers is related to the termination of the supposedly fast track Canadian millionaire visa program last winter. If you can’t get fast track Canadian citizenship to buy in West Vancouver BC, maybe West Bellevue suddenly becomes an acceptable alternative source of supply.


    But if you’re concerned about West Bellevue becoming the new “International District”, I suggest that you get over it. On the other hand, if you occasionally find a little humor in irony here’s a clip that could now be Blurtman (played by Jack Nicholson) having a discussion with a mortgage banker. It’s taken from bad boy director and criminal Roman Polanski’s classic film “Chinatown.” For those who believe there are social benefits to being “politically correct”, please excuse the ethnic humor at the end of the clip. Ironically my grand father was one of six children conceived by my great grand parents in Nanjing, China in the late 19th Century. I’m pretty sure that my great grand father didn’t smoke, but in a pre-late night TV world he probably did look at the stars.


  12. 12

    RE: Kary L. Krismer @ 6

    Yes Kary

    Its one thing to see credible evidence in writing with backed up statistics, rather than verbal guesses of undocumented opinion just because it agrees with a possible bull market.

    General investors are fleeing real estate and to say it excludes Chinese or any part of the investor population is just a wild guess…..even this news article today on investors dropping out of real estate in hoards because they fear higher interest rates soon doesn’t document “except Chinese”.


  13. 13

    RE: redmondjp @ 4

    Buffet Thinks Exactly Like SWE

    Why tie up money in more expensive real estate risk, when your present “paid for” lower priced house is just fine? If it runs don’t fix it….using Buffet’s example of real estate purchasing made him more money too.


    Last I heard recently, Buffet drives an older 2006 Cadillac too [which he loves]. I agree with Buffet, the older and much bigger 2006 Cadillac is much nicer looking than today’s “pea-sized” Malibu 4 cylinder frame looking Cadillacs.

  14. 14
    Blurtman says:

    RE: One Eyed Man @ 11 – “Forget it, Jake, it’s Sammamish town.”


  15. 15
    Deerhawke says:

    I have poker friends who live in one of the tonier West Bellevue burbs with views of the Seattle skyline and they were commenting that all the recent sales in their area were to Chinese or ethnic Chinese from Vietnam. Same story as in the NY times. Sold from pictures to buyers overseas sight unseen, all cash, no contingencies, etc. etc. and then mostly left vacant for long periods until rented out. The gaudier the East side mansion architecture, the better. They have been talking about it for 2 years so this is not a really new thing

  16. 16
    Warren Buffett says:

    RE: softwarengineer @ 13

    “Buffet Thinks Exactly Like SWE”

    Dear SWE:

    It’s spelled Buffett but I forgive you. I’ve been searching my whole life to find someone who thinks exactly like me and it appears I have finally found him. We not only share the same level of intelligence but we also have a similar taste in home decor (I have that very same couch in my living room). And I too like to slouch when I sit on it. My secretary is printing all of your comments from this blog and will bind them together in a book. I will read your insightful remarks and use them to guide not only my investment decisions but my important life decisions. Many thanks.


    Warren Edward Buffett

  17. 17
    jm31828 says:

    The mainland Chinese do not think like many here. Many here may be scared off from real estate now, but not the Chinese. My wife is from there, most of her family is back there. The number one thing they talk about for investment is to buy a house or two in the united states. To them that is the best thing they can do, since America is still so desirable and our houses are cheap in their eyes. Yes, even ours in the Seattle area! Also many are moving here as the article notes, for the reasons noted. They have no problem getting money out of China, I don’t know where the impression came from that this was not allowed. They do it all the time. They don’t bring it in the form of cash on the plane, but to buy property they can wire it from their bank accounts.

  18. 18

    RE: Warren Buffett @ 16
    Welcome to Seattle Bubble, Warren. I hope you can pick up a few investment tips here and learn a few things.

  19. 19
    BacktoBasic says:

    A Chinese property bubble will have tsunami effect on property bubble in this side of lake. Just like Seattle bubble will have same effect on eastside of the lake.

  20. 20
    Dr.Chang says:

    I even know quite a few Chinese stay-at-home tiger-moms whose “hobby” (between entertaining husbands and dragging their kids between skating ring and violin classes ) is to look after Bellevue and Seattle properties owned by their relatives from Taiwan and Mainland China.

    So when those numerous nephews ripen they could enter WSU, get the world’s best education, work for Amazon or Microsoft (managing local sloth workers) and buy more real estate.

  21. 21
    Deerhawke says:

    It seems that the Chinese investors are branching out. They seem to have discovered Seattle.

    A premium at 7520 2nd Ave NE, Seattle 98115 (MLS# 669757) house in Greenlake recently sold rather quickly and all cash (according to local rumor) for $1.4 million. Now two weeks later it is offered on Craigslist for a mere $5595/month.


    One-off? Or the beginning of a trend?

  22. 22
    Roger Ingalls says:

    I live in an area where there has been pretty rapid growth in Asian buyers (S Bellevue). One of the easier ways to measure the impact would be to check the OSPI data for schools in the area, and see if the Asian population is rising.


    Yup, it is. Interesting, but Seattle Schools are trending downward in Asian students

  23. 23
    boater says:

    RE: Roger Ingalls @ 22
    if the Chinese buyers are like the guy in my neighborhood then you wont see a rise in Asian students because he’s still in China. He just rents the housing out.

  24. 24
    wreckingbull says:

    RE: Roger Ingalls @ 22 – Let’s not confuse nationality with ethnicity. This article relates to the former.

  25. 25
    Aqua says:

    We sold our house in downtown Kirkland in Spring 2009 to an all cash Chinese buyer. They rent it out.

  26. 26
    cleansocks says:

    we’ve made offers at 20% down on 3 houses in Bellevue at just above a million each now. Each time fong bing cho or chow yi fut have made all cash above asking price offers after their wife and kid visit and decide they like the place. The dad is never there.

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