Earlier this year at Navigate 2016, a Leverage global partners conference held at Terranea Resort in Palos Verdes, Sean Mei, founding partner of Partners Trust China, discussed the vast investment opportunities in China, as well as the challenges therein. For those unable to attend, Leverage has just released a video recording of Mei’s talk — available here. Here are the key takeaways:
Each year in China, the rate of growth for millionaires living in the country, has been accelerating, with an increase of 1.2 million millionaires since last year. This population is spreading from the major cities to the inland or second tier cities.
Eight percent of families in China are planning emigration. This means they want to relocate; the majority motivated by their children’s educational opportunity or for retirement, and the destination for these families is predominantly the United States.
With these plans in motion, these eventualities in place, the potential is huge and savvy real estate professionals are taking note. The challenges often lie in the ability to move money from China with a cap for individuals of $50,000 per year. This is the reason many Chinese clients have set price-points. In the past, many will get friends and relatives to combine funds and pool their money together. However, there is a government moratorium in place, which restricts pooling and collecting money. This is temporary and real estate professionals such as Mei believe it is only a “knee jerk response” that they don’t think will last. In the larger picture, the government is moving toward a freely traded currency, and this will undoubtedly result in a huge wave of investors.
While the challenges are significant, the opportunities, again, are vast. Partners Trust China, Mei shares, hopes to be a high level conduit between the markets, a means of helping people face these challenges, overcome confusions in the market, and eventually make sound and successful investments in the US real estate market.
Leverage, founded by Partners Trust’s Nick Segal and F. Ron Smith, empowers an international network of independent real estate companies — including 5,713 agents in 163 markets in 16 countries — with shared intelligence, agile marketing strategies and entrepreneurial connectivity.