Number of listings grow as Chinese investors shy away
Postmedia News May 13, 2011 Interest in Richmond real estate may be dropping -- at least for now -- among mainland Chinese investors.
The reason? Japan's devastating earthquake and resulting tsunami in March, which killed thousands and flooded much of that country's low-level coastline, is seen as something that could happen in Richmond's low-lying areas as well.
A local earthquake expert believes the investors may have a point to be concerned, although he thinks the specific danger from a tsunami is minimal.
"The shine is off Richmond right now," Cam Good, president of The Key, a Vancouver-based sales and marketing firm that's focusing on a new wave of Chinese buyers, said in an interview Friday.
"I believe it will return, but it's off for now. And that's been true since the (Japan) earthquake. It was absolutely top of mind with most of the Chinese I talked to in China," Good said of recent meetings with potential clients at his Beijing office. "They're worried that a wave could hit Richmond and that they might suffer as they saw the Japanese suffer.
"We're now seeing more listing availabilities in Richmond."
Richmond and Vancouver's west side have been extremely popular in recent months among mainland Chinese buyers and immigrants looking for a place to either invest or build a home in Metro Vancouver.
In some cases, Richmond lots have sold for well over $1 million as buyers compete with each other through multiple offers.
However, the phenomenon is now spreading to other areas -- especially Burnaby, but also Coquitlam and West Vancouver -- as overseas buyers look to high ground.
"Burnaby is higher ground, which is very popular with the Chinese right now," added Good.
"There's also been a little bit of interest in Squamish, because of it's proximity to Vancouver and Whistler, both very famous addresses in the Chinese community."
Earthquake expert Peter Byrne, a professor in the University of B.C.'s department of civil engineering, said in an interview that he believes an earthquake could greatly impact Richmond, but it's the soil -- not a tsunami -- that is the greatest danger.
"Richmond is in the Fraser Delta and has a silty crust on top and loose sands below. The concern is that much of the sands underneath would liquefy.
"The danger is that the soil conditions are very poor. When soil liquefies, water escapes to the surface."
Re/Max realtor Jake Moldowan, whose sales market includes Richmond, said sales to mainland Chinese have dropped sharply recently, but he hasn't heard that earthquake fears are the reason. Instead, he said, he believes it's more a reflection of savvy investing practices. "That doesn't necessarily mean some people (aren't) deterred (by earthquake fears). There's still sales, but not to the degree of where it was before."
Moldowan said Richmond will always be a top choice for Chinese buyers, largely because there's such a strong concentration of Chinese living in the city.
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