San Francisco Real Estate Market Feels the Effects of China's Economic Slowdown
Despite being thousands of miles apart, the economic turmoil in China has apparently reached San Francisco, causing a major decrease in the volume for real estate inquiries, a report showed.
Data from real estate search engine Trulia, as reported by the China Daily, showed that real estate searches from Chinese would-be buyers for San Francisco properties had dropped by 50 percent. San Francisco is one of the biggest real estate markets in the State of California and in the whole country.
San Francisco suffered the biggest decline in terms of real estate searches from Chinese clients across the country. The report showed that the national drop was only pegged at 30 percent. Some experts believe that although the economic turmoil in China was the main reason for the decline, San Francisco's skyrocketing property prices could also be partly blamed.
Trulia's chief economist Ralph McLaughlin said any decline in the interest of Chinese buyers in San Francisco's real estate could have a catastrophic effect on its real estate market. It was because Chinese buyers make up about 6 to 10 percent of real estate buyers in San Francisco.
"We've seen a sharp drop over the last three years in search activity on Trulia, about 50 percent. San Francisco's more pronounced than the drop we've seen on the national level. Nationally, it's down about 30 percent. There aren't as many bargains, discounted homes as we've seen in 2012, 2013," McLaughlin was quoted as saying by the China Daily.
In a separate report published by the ABC 7 News, it appeared that it's not only the San Francisco property market that's been badly affected by the market woes in the Mainland China. In fact, the report noted, even real estate market in the Bay Area, another key property market in California, is starting to feel the ill effects of what's happening in the local economy back in China. It added that local real estate agents are now seeing some of their clients having second thought in the market the past months.