A recent conference of the National Association of Real Estate Editors that took place in Miami revealed some of the latest trends in the real estate industry, including the trends that are appear to be developing in luxury real estate. From apps to help you find a new home to purchase to the Chinese investment boom, the trends for 2015 show a real estate industry that continues to grow.
Real estate experts at the conference revealed that the Chinese continue to invest in real estate in the United States, with Chinese home shoppers spending $28.6 billion on homes in the United States between March 2014 and March 2015. At least $10 billion of those dollars were spent on homes in California.
Chinese investments in commercial real estate are also growing, with the number of Chinese citizens taking advantage of the EB-5 program reaching maximum capacity. Under this program, foreign investors can get permanent U.S. residency for themselves, their spouse and children under the age of 21 if they invest enough money in the United States to create at least ten jobs.
In 2014, the full 10,000-visa allotment offered through the program was reached by August. This year, the allotment was reached by May with more than 80 percent of the Visas going to Chinese citizens. In all, EB-5 investments totaled $2 billion in 2013 with $317 million of those dollars being spent on residential and commercial real estate. EB-5 spending in Orange County totaled $25.1 million in 2013.
The Lodging Industry Gets a Boost
Across the country, hotel occupancy rates are hitting record levels as demand from both business and leisure travelers continues to grow. In Orange County, the occupancy rate was 76.6 percent in 2014. This year, the rate is projected to be 77.6 percent. Both figures are significantly higher than the projected occupancy rate of 65.7 percent, which represents a record high. Last year, the national occupancy rate was 64.4 percent. Los Angeles also had an impressive showing with an occupancy rate of 79 percent.
In addition to hotels experiencing a boom, short-term vacation rentals are also seeing a rise in popularity. Vacation rental sites such as VRBO, Airbnb and HomeAway allow travels to rent a spare room or an entire house. These sites are increasingly being used to find renters for investment properties and second homes. Airbnb alone has more than 14,500 listings in Los Angeles and at least 800 for Orange County.
The latest data also shows that a growing number of individuals are choosing to get into the investment business, with 95 percent of those investing in properties to hold as rentals being individuals rather than big firms. As homeownership rates continue to fall, the benefits of purchasing a home in order to rent it out will increase. Nationally speaking, homeownership rates fell to a 22-year low of 63.7 percent this year.
If you are interested in learning more about Southern California luxury real estate, please contact our team of luxury property experts today. We’d love to help you find the perfect Irvine home for you and your family.