As the number of Chinese millionaires continues to grow, a Los Angeles suburb has become a haven for Chinese millionaires who want to invest in US real estate.
As of the most recent Census in 2010, more than 44% of Arcadia’s residents were Chinese. That number is only expected to grow as modest suburban homes continue to be torn down and replaced by Chinese-funded McMansions, Bloomberg Businessweek has reported.
The city’s large lots and lenient building codes entice many wealthy Chinese looking to invest in property development.
In 2014 alone, 150 older homes (53% more than normal) were torn down to build mansions in Arcadia, Mortgage Professional America reported. Residents have become accustomed to receiving extravagant, all-cash offers for their properties from China’s wealthiest entrepreneurs. The National Association of Realtors estimates that $US22 billion of the $US660 billion in personal wealth held by the Chinese offshore was spent on US property in 2014.
Arcadia is not the only wealthy, majority-Asian suburb to pop up in the San Gabriel valley. San Marino and Monterey Park have become hot spots for Chinese buyers, according to Property ID. More than half of Monterey Park residents and 33% of San Marino residents are Chinese.
Monterey Park was declared the first suburban Chinatown when Chinese immigrants began settling down in San Gabriel in the 1980s. Now, the valley is home to dozens of Chinese restaurants, Asian banks, and multilingual travel agencies that make the Chinese feel at home when they visit.
In the US, the Chinese can both protect and flaunt their wealth in valuable assets. “Buying American real estate is becoming a fashion for some Chinese to show off wealth and status,” Edward Huang, a former senior planner at the Los Angeles Redevelopment Agency, told USC publication US-China Today.
For others, questionable business practices in China may be a motivating factor for starting over in the US. Arcadia resident Cheng Quingbo was the first private owner of railroads in China and, by 2013, was the country’s 257th-richest person, worth an estimated $US1.06 billion. He was arrested last June by Shanghai police for allegedly tricking people into making bad investments, Businessweek reported.
The Chinese government started a crackdown on corrupt Chinese officials stashing their cash in overseas mansions and other assets early last year, soliciting the help of France, Canada, and the US in tracking them down.
More than 150 of these officials are reportedly at large in the US with pilfered assets worth over 800 billion Yuan ($US135 billion), according to International Business Times.
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