1. Is California Real Estate Cyclical?
Just like life itself, California real estate is indeed cyclical. It goes up in value, fast, then pauses with the business and economic cycles, retrenches a bit, then builds support for its next quick dash upwards. Imagine, if you will, trying to walk up a sand dune. With each step upwards, you slide back some. If you just concentrated on the backwards sliding, you would give up; but, if you look at the whole picture, all the ups and downs, you will see that eventually you will reach the top. California real estate has its ups and downs, but historically, over time, the trend in value is ever upwards. So, relax and enjoy the ride!
2. How Does California Real Estate Compare?
When thinking about California real estate, it is useful to see how it compares, both to other investments, and to other areas real estate. To start off, real estate isn’t the only thing that investors should look at. It is not an all or none choice. Instead, real estate should be one of a diversified portfolio of investments. Each has its place, and its pros and cons, and together they spread out any risk and smooth out the upward journey. Having said that, I do need to point out that more investors have become millionaires through real estate than with any other investment vehicle.
3. What to Look for in California Real Estate?
There is a saying in the real estate investment market that the three most important aspects of real estate are location, location, and location! What this means is that where your real estate is situated is the most important factor that makes up value. Think for instance of two houses, both with identical size lots, square footage, and construction materials, but one house is in the middle of nowhere, and the other is in or close to a major population center. Obviously the property located in or near a highly populated area will normally be worth much, much more.
4. Is it Better to Rent or Own?
For the short term, or if there is great uncertainty about where you might find employment, renting may make more sense. If you don’t have a down payment, good credit, or a stable job history, renting may be your only option. However, for most people who can look forward to remaining in the same area for at least several years, buying usually is the hands down winner. For most people, if they don’t own a home, they would not have anything except Social Security to fund their retirement.
5. Can Chinese Investors Buy California Real Estate?
Yes! For many foreign investors, United States real estate represents their safest and most stable home for their investment dollars. Chinese investors have owned California real estate since before California became a state over one hundred and fifty years ago. Back then, as today, quality, well located California can be the cornerstone of your family fortune.
6. How is it Possible to Buy California Real Estate Even if You Live in China?
With the management team at Great Leap Forward Investments, purchasing your California real estate is easy and straight forward. Once funds are wired or mailed to us, we begin the search to locate that property that not only matches the size of your investment, or the total amount of an investment pooled together with other investors, but upon identifying that property, the experts at Great Leap Forward negotiate a purchase price, carry out all necessary inspections, sign all paperwork on your behalf, and make sure that the property conveys clear title. Your investment funds are transferred to a title and Escrow Company before escrow closes and the property is yours!
7. Are There Special Situations That Apply to Chinese Investors?
For the Chinese investor who already has foreign currency ( non-Yuan ), whether located inside China or abroad, there is an important consideration: exchange rates! The Chinese government keeps the Yuan exchange rate artificially low in order to increase exports. This makes the purchase of foreign made goods and services, inside China, more expensive. If you already have foreign currency, don’t exchange it for Yuan! Instead, use it for your investment in California real estate and save money.
8. Is California Real Estate The Best Investment For You?
While there is no one ‘best’ investment since your investment decision must take into consideration many factors such as how much you have to invest, your investment time horizon, your aversion to risk, investment diversification, safety and stability of the country in which you are investing, relative scarcity of your investment vehicle, etc.. Remember that each parcel of real estate in unique. California real estate is a very safe, secure, and most profitable investment. After all, everyone needs a place to work and live! And California continues to attract people, jobs, and investment, especially in high technology industries.
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9. Where in California Should You Buy?
When you read the answer, you might think this is a trick question, but it is not. The answer is really quite logical. Buy what you know! Great Leap Forward is very knowledgeable about the San Francisco Bay Area, and especially the Silicon Valley area, home to such hi-tech titans as Apple, Hewlet Packard, Facebook, Twitter, Oracle, Intel, and hundreds more. The San Francisco Bay Area is also home to world famous Stanford University and the University of California at Berkeley. Enjoy the movies? We are home to Pixar, Lucas Film (Star Wars), and others. This is also where the Bank of America and Wells Fargo Bank began, as well as home to the World Champion San Francisco Giants baseball team. We have it all, a growing population, a major financial and industrial center, and some of the best weather and most beautiful scenery in the world!
10. How Can You be Sure You Get Legal Title To The Real Estate Property?
In California we always use a Title and Escrow company. The title company, from whom we purchase insurance guaranteeing our clear title to the property we wish to buy, does extensive research to make sure that the seller is the legal owner of the property you are purchasing. And the escrow company serves as the unbiased, neutral agent who makes sure that the purchase and sale of real estate is carried out legally and according to the terms and conditions agreed upon by the buyer and seller. Your money is not transferred to the seller until we have clear and legal title!
11. How Can You Manage Your California Estate?
You can relax at home in China, knowing that Great Leap Forward will manage your investment in California real estate and protect its value. We will employ rental agents to keep the property fully rented out, collect rents, handle leasing, and take care of all property maintenance. After all expenses are paid and a proper reserve is built up, we will deposit your net rental income into an account and location of your choice.
12. Who Will Handle Accounting and Tax Reporting?
Great Leap Forward will have accurate and timely accounting records kept for you, and quarterly statements will be mailed to you. If you have a United States tax identification number, we can have annual accounting statements prepared for your tax preparer. If you wish to leave title in your Great Leap Forward account, we can take care of all tax filings and pay all necessary tax bills. You won’t have to do anything except decide how you are going to spend your property income!
13. Is The San Francisco Bay Area a Hot Business Economy?
You bet! We have a very diverse and vibrant business environment here, with world famous hi-tech and bio-tech leaders, solar electric and electric car innovators, even agriculture and fishing industries, all surrounded by some of the most beautiful scenery anywhere in the world. When you add in world class universities and great weather, is it any wonder that the Bay Area is one of the most desirable places on this planet in which to live and work? The San Francisco Bay Area is also home to the second largest Chinese-American population in the United States. San Francisco’s Mayor is a Chinese-American! And snow skiing, Yosemite National Park, and Hollywood are a car trip away. Wouldn’t you like to live here too?
14. Will the Real Estate Manager be Motivated?
Since as part of our compensation we have a small share in the ultimate profit upon sale of your property, we are very motivated to maximize your properties potential. Also, since we want to build a long-term business relationship, one that is profitable for you and us, we will work diligently upon your behalf. Your continued prosperity is our number one goal. Together, we can grow your family’s financial future.
15. Should a Chinese Investor Use Yuan or Foreign Currency?
If you are fortunate enough to have earned foreign currency in your business and investment activities, you should use those funds first before exchanging Yuan into dollars. The Chinese Yuan is an undervalued currency, kept this way by the government so as to increase the level of Chinese exports. This is good for China, but bad for your foreign investments. By using your existing non-Yuan currency, you escape the low exchange rate, and increase your international diversification. If you wish to increase your business in America, a California home gives you the perfect base from which to operate. We can rent it out, earning income, until you are ready to occupy it.
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