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How are trade laws affecting real estate?

On Behalf of | Aug 27, 2019 | Firm News

The economy is a tricky thing. When one segment has an issue, it tends to bleed into the other segments. That is what is happening with the real estate market in California thanks to issues with trade in the U.S. economy. According to The Mercury News, new trade wars with China have led to Chinese investors moving out of the real estate market in California. This is taking a toll on real estate sales and investments as a whole.

They are moving out of the country because the trade laws here are no longer advantageous. This means they are leaving behind empty homes. This also means there are no new investors moving in to take their place.

While it is only Chinese investors, they are a large segment of the foreign buying market in the state. They make up about one-third of the total of foreign real estate investments. That is having a large impact on the market because it is a huge loss.

It is bleeding over into other foreign investors as they are uncertain about what will happen for foreign trade in the future. This is making the market lag behind its normal numbers.

As one of the largest foreign investment markets in the country, this is a huge blow to California’s real estate industry. It is leading to a drop in home prices, which affects everyone. So, the effects are spreading further than just the foreign market. This information is for education and is not legal advice.