4 ms·

I don't know man? What was it? Like 36% decrease in foreign buying overall? China specifically was like a 60% decrease? I'm not an expert or anything, so what

I don't know man? What was it? Like 36% decrease in foreign buying overall? China specifically was like a 60% decrease? I'm not an expert or anything, so what I think means exactly jack. Having mentioned that, those decreases seem to me to be far in excess of anything that could be reasonably explained by economic factors alone. Something must be going on. "Fleeing" seems like a legitimate label for it.

roenxi 7y ago
It says in the opening paragraph "tighter currency controls by the Chinese government". As with most financial articles there is no discussion of the relative magnitude of the effects at play. Financial journalists are perfectly happy to ignore the elephants in the room and report a laundry list of tiny effects that might have had an impact and then devote 1 line to whatever causes 80% of the change observed. Fleeing implies they have a choice and are choosing to leave because of poor prospects in US housing. That might be true. But the choice might be involuntary or be due to sharply rising prospects in China or elsewhere. If China those capital controls are significant, maybe a better title is "Chinese purchasers dragged away from US housing kicking, screaming and cursing their own government". That is a possible interpretation based on what is included in the article.
- fabianhjr 7y ago
  > As with most financial articles there is no discussion of the relative magnitude of the effects at play. Principal Component Analysis is really difficult to do on a live economy because no one is omniscient and policies/events enter and go in a less than ideal simultaneity.
- bilbo0s 7y ago
  But 36%? I mean, the Canadians don't have currency controls. Neither do the Mexicans. All three of the Big Three foreign real estate buyers have pulled back in a material fashion this year. Like I said, I just think something must be going on here. I don't think this can be waved off as "Well, it's just China."
  - tapatio 7y ago
    Wot? "Hispanics are experiencing the largest homeownership gains of any ethnic group in the U.S., a turnaround for the population hardest hit by the housing bust that could help buoy the market for years." https://www.wsj.com/articles/wave-of-hispanic-buyers-boosts-u-s-housing-market-11563183000 https://www.wsj.com/articles/wave-of-hispanic-buyers-boosts-...
    - bilbo0s 7y ago
      Uh... We're talking about foreign buyers. We mean "Mexican" buyers as in, actual citizens of Mexico. Not Mexican buyers as in, "That guy has a funny, spanish sounding last name, he must be Mexican." We're not talking about Hispanic Americans.
      - kgwgk 7y ago
        Note that there are also millions of Mexicans which are US residents but not US citizens.
  - JMTQp8lwXL 7y ago
    Compared to Mexico and Canada, China's economy has changed dramatically in the past 20 years. A middle class emerged in China. Tons of wealth created. A large number of potential purchasers of foreign real estate. Mexico is today where China was at the turn of the century (when comparing GDP).
    - mobilefriendly 7y ago
      What's your source? Mexico's per capita GDP is the same as China's and Mexico's data is probably more accurate. Mexico is a middle income country and NAFTA has been transformative for Mexico in the last couple of decades.
      - JMTQp8lwXL 7y ago
        I wasn't citing the per-capita numbers. Here's total GDP: China, 2000: 1.2 trillion USD [0] China, 2017: 12.2 trillion USD [0] Mexico, 2000: 700 billion USD [1] Mexico, 2017: 1.15 trillion USD [1] If GDP is a proxy for wealth, China --over the past ~2 decades-- had way much more potential in investing in foreign real estate. I don't understand why per capita GDP would be more relevant in determining which nation would have more capacity in investing in foreign real estate. That capacity for investment seems independent of how the wealth is divided among a countries citizens. [0] https://www.google.com/search?q=china+gdp https://www.google.com/search?q=china+gdp [1] https://www.google.com/search?q=mexico+gdp https://www.google.com/search?q=mexico+gdp
- seanmcdirmid 7y ago
  The inability to acquire fully convertible currency means they have to leave the market. Yes, they are being forced, but the same could be said about any influence they would have to react to.

roenxi 7y ago

It says in the opening paragraph "tighter currency controls by the Chinese government". As with most financial articles there is no discussion of the relative magnitude of the effects at play. Financial journalists are perfectly happy to ignore the elephants in the room and report a laundry list of tiny effects that might have had an impact and then devote 1 line to whatever causes 80% of the change observed. Fleeing implies they have a choice and are choosing to leave because of poor prospects in US housing. That might be true. But the choice might be involuntary or be due to sharply rising prospects in China or elsewhere. If China those capital controls are significant, maybe a better title is "Chinese purchasers dragged away from US housing kicking, screaming and cursing their own government". That is a possible interpretation based on what is included in the article.

fabianhjr 7y ago
> As with most financial articles there is no discussion of the relative magnitude of the effects at play. Principal Component Analysis is really difficult to do on a live economy because no one is omniscient and policies/events enter and go in a less than ideal simultaneity.
bilbo0s 7y ago
But 36%? I mean, the Canadians don't have currency controls. Neither do the Mexicans. All three of the Big Three foreign real estate buyers have pulled back in a material fashion this year. Like I said, I just think something must be going on here. I don't think this can be waved off as "Well, it's just China."
- tapatio 7y ago
  Wot? "Hispanics are experiencing the largest homeownership gains of any ethnic group in the U.S., a turnaround for the population hardest hit by the housing bust that could help buoy the market for years." https://www.wsj.com/articles/wave-of-hispanic-buyers-boosts-u-s-housing-market-11563183000 https://www.wsj.com/articles/wave-of-hispanic-buyers-boosts-...
  - bilbo0s 7y ago
    Uh... We're talking about foreign buyers. We mean "Mexican" buyers as in, actual citizens of Mexico. Not Mexican buyers as in, "That guy has a funny, spanish sounding last name, he must be Mexican." We're not talking about Hispanic Americans.
    - kgwgk 7y ago
      Note that there are also millions of Mexicans which are US residents but not US citizens.
- JMTQp8lwXL 7y ago
  Compared to Mexico and Canada, China's economy has changed dramatically in the past 20 years. A middle class emerged in China. Tons of wealth created. A large number of potential purchasers of foreign real estate. Mexico is today where China was at the turn of the century (when comparing GDP).
  - mobilefriendly 7y ago
    What's your source? Mexico's per capita GDP is the same as China's and Mexico's data is probably more accurate. Mexico is a middle income country and NAFTA has been transformative for Mexico in the last couple of decades.
    - JMTQp8lwXL 7y ago
      I wasn't citing the per-capita numbers. Here's total GDP: China, 2000: 1.2 trillion USD [0] China, 2017: 12.2 trillion USD [0] Mexico, 2000: 700 billion USD [1] Mexico, 2017: 1.15 trillion USD [1] If GDP is a proxy for wealth, China --over the past ~2 decades-- had way much more potential in investing in foreign real estate. I don't understand why per capita GDP would be more relevant in determining which nation would have more capacity in investing in foreign real estate. That capacity for investment seems independent of how the wealth is divided among a countries citizens. [0] https://www.google.com/search?q=china+gdp https://www.google.com/search?q=china+gdp [1] https://www.google.com/search?q=mexico+gdp https://www.google.com/search?q=mexico+gdp
seanmcdirmid 7y ago
The inability to acquire fully convertible currency means they have to leave the market. Yes, they are being forced, but the same could be said about any influence they would have to react to.