Coronavirus disruption is slowing down the global luxury market

Tours and closings hampered by travel restrictions

TRD NATIONAL /
Mar.March 03, 2020 08:37 AM
Many wealthy Chinese have chosen to stay overseas during the outbreak. (Photo by TIZIANA FABI/AFP via Getty Images; Unsplash)

Many wealthy Chinese have chosen to stay overseas during the outbreak. (Photo by TIZIANA FABI/AFP via Getty Images; Unsplash)

Apartment tours via WhatsApp. Surgical masks at open houses. As the coronavirus outbreak disrupts international travel and threatens to infect millions worldwide, sellers of luxury real estate worldwide are seeing their business impacted in many ways.

Chinese buyers were still the single largest group of foreign homebuyers in the U.S. last year despite a steep drop-off, spending $13.4 billion on U.S. property, Bloomberg reported.

“I tell them that I have some nice properties that I saved for them,” Keller Williams broker associate Coco Tan told the publication, noting that most Chinese buyers — who represent about 25 percent of her clientele — have postponed visits to California until after the summer.

Last week, luxury home builder Toll Brothers said that 11 closings in California had been delayed because of COVID-19.

Meanwhile, as many wealthy Chinese have chosen to stay overseas during the outbreak, Sydney’s luxury market has seen a brief surge in demand — though embassy closures have slowed down processing of “significant investor” visas, or Australia’s version of EB-5.

And many neighborhoods in Los Angeles’ Orange County, where Chinese buyers often only reside part-time, appear more populated these days as more people choose to stay put.

Disruption to construction supply chains could also become a problem for residential developers. Silverback Development is currently seeking alternatives to granite countertops from China for its 13-story condo project near Gramercy Park in Manhattan.

“We’re nervous,” Silverback principal Josh Schuster said. “What if the supply chain could cause delay to the delivery of our kitchens or stone materials? Without a real solution, I can’t take that risk.” [Bloomberg] — Kevin Sun


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