Chinese Home Purchases Not Likely To Change

Silicon Valley Homeowner ImmigrationWith president Trump’s many campaign speeches criticizing both illegal immigration, and U.S. companies moving factories to foreign countries, are Chinese home purchases in Silicon Valley likely to fall? Probably not.

1.) Yes, Canada’s federal program of giving resident status to wealthy foreign investors was ended in 2014. It was criticized for requiring a relatively low and risk-free cost on foreign investors, not creating new jobs, and distorting housing markets. The U.S. EB-5 visa is generally judged to be better at creating jobs, and imposing a higher cost on prospective investors. Although some people claim there are many Chinese nationals owning “vacant” homes in Silicon Valley, my experience has been that most Chinese buyers already live and work here, and most others want to also. The economic downturn affected some Chinese immigrants severely enough that they did fall back on their home country to earn a living but kept their U.S. home. Although a home seller would be quite foolish to not make his home attractive to Chinese investors, the prime driving force behind higher Silicon Valley home prices is EMPLOYMENT.

2.) President Trump’s campaign speeches got him a tremendous amount of free publicity. He has quickly started moving forward on some of his ideas, generally around promoting sound job and investment growth in the U.S. The EB-5 visa is intended to promote U.S. job growth. Trump’s own 50 story Trump Bay Apartment project raised $50M from EB-5 investments. He may want to modify the program but I do not believe he will want to change the intent of the program.

3.) President Trump created a strong pro-U.S. local business image for himself. A Chinese national wanting to build a business in the U.S. is not likely to see this image at odds to his own goals.

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