I have been selling homes in the San Gabriel Valley for over 11 years, and my specialty has been selling San Marino homes. Working in this market, I watched a tide of foreign buyers (largely from China) flood the market and drive up prices at an extraordinary pace. Arcadia CA real estate followed a similar trajectory and seemed to be equally popular with this buyer pool. Although it felt like the money would never stop, there was a definite shift toward the end of 2015 that cooresponded with tightening restrictions on taking money out of China. Prices leveled and there was a marked change in the volume of qualified buyers.
I have been watching the San Marino and Arcadia CA real estate markets ever since, waiting to see what unfolds. I have wondered whether the shift I noticed starting in 2015 would continue to grow. Has the foreign cash dried up and will prices start to drop more precipitously, allowing room for “regular guys” with traditional financing to re-enter the market? Or was the shift we experienced just a short-term issue that will resolve over time? Maybe the foreign money is just on hold and will start to flow freely again in time.
My questions about the state of these important markets was recently put to the test when I listed a Lower Rancho home at 910 Encanto Drive in Arcadia. It was an attractive one-story home on a nice wide lot and sited on a great street. The home was small for the lot, so there was room for expansion or the possibility of big new construction. It was also in poor condition, definitely needing systems work, a new roof, and a new kitchen and baths. To attract a lot of interest, I priced it at $1,288,000, with a personal goal of reaching a purchase price of $1,500,000.
From the moment I put it onto the Multiple Listing Service, I knew it was going to be an electric sale. My phone was ringing off the hook with requests to show it, my open houses were brimmig with visitors, and my inbox was flooded with requests for offer guidelines. I held the house open for 2 weeks, wanting to ensure that the home was thoroughly marketed, but this was definitely over-kill. When my offer deadline arrived, I received 40 offers – the most I have ever received on one of my listings!
Of the 40 offers received, almost all of them were all-cash and all but one of them were from Chinese buyers. After one round of counter offers to a group of the best offers, the final sales price was driven up by 36% to $1,751,000. The final price was greater than I could ever have imagined and I would be hard-pressed to find comparable sales that would validate paying that much for the home, but someone did. It was incredible!
So does this mean that the San Marino and Arcadia CA real estate markets are returning to their pre-2015 glory? Have the foreign buyers found a way to get their money out of China and will the buying frenzy return to these San Gabriel Valley cities? Stay tuned for my next post where I will dive into these questions.
Carrie Benuska, Keller Williams Realty, 125 S Lake Ave, Suite 150, Pasadena, CA 91101