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Agent of the Month: Eric Chen, Long & Foster Real Estate
By Juwai, 27 November 2017
Long & Foster Real Estate is the No. 1 independent brand (by sales volume) in the US, as well as the largest global affiliate of Christie’s International Real Estate.
With over 11,000 agents and 220 sales offices in the Mid-Atlantic and Northeast regions, Long & Foster has been a valued Juwai partner and client since 2015.
We caught up with Eric Chen, Director of Asia Pacific Initiatives at Long & Foster, who oversees the expansion of Long & Foster's client base and business presence in Asia, especially China, and ask him for insights into Chinese buyers in the US real estate market.
Working with Chinese buyers
“I think often real estate agents think the process from purchase to closing is simple and quick, and that Chinese are all cash buyers. That’s not true – I have to raise awareness that the average closing time is 9 months. I advise US agents, 'You need to help Chinese clients focus, send them listings, and help them find the house',” said Chen.
Based on his experience, the average timing from the first contact with a Chinese buyer to closing the transaction is nine and a half months, while the longest case took one and a half years.
“Most of the buyers need to come to the US, and that’s the point when you need to be available for them. Once they arrive, they can close in 5 days or 1 week. In the first few days, you can take them to view houses and after that, they may be ready to make an offer," he adds.
"The last one week or four days is what people see, but they don’t realise it takes 8 months of communication with China, ahead of time. Maybe you get lucky with one or two who just buy without any questions, but in general, that’s not the case.”
Chen explained that Long & Foster’s footprint is primarily the Eastern United States, with more closings in Virginia, Maryland than in northern California or Chicago.
“Our marketing effort is really focused on our own Long & Foster 7-state footprint. Yet we are customer-oriented, so even when buyers don’t want to stay in our footprint, we will still help them. I can’t tell them, ‘Sorry, I can’t help you if you want to go to Texas.’ Instead, I can help them to find a good partner in Texas, and I will still keep in contact with them in case they have any questions.”
Myths held by Chinese buyers
According to Chen, one of the biggest misconceptions held by Chinese buyers is that buying a house in the US will get them a green card, which isn’t true.
Most of his Chinese buyers also think that purchasing a house in a good school area would entitle their children to attend that school, which also isn’t true. Children need to have a green card, citizenship or a certain visa before they can go to public school in the States. Of course, they can choose to go to private school.
“Even after my explanation, Chinese will still buy the house in a good school district for two reasons. One reason, I think, is that some have plans to emigrate to the US, so they will buy now and in the future, when they have their green cards, their kids can go to the good school. Another reason they buy in a good school district is for the investment purpose because those properties are usually good investment properties,” adds Chen.
“It depends on how well they research. Some get the wrong information and some probably don’t have much information at all when they reach out, and so they start from scratch.”
Chinese buyer trends in the US
While education is one of the biggest motivations spurring Chinese buyers to purchase property in the US, Chen listed other driving factors, including investment, emigration, and several cases of Chinese buyers seeking a retirement place.
“Several of them ask for a plan with farmland, for example. They are not coming here to be a farmer but to enjoy the environment of clean air and green. Some request the need to have water on their 10-acre farm, or a river – it’s very specific,” said Chen.
“When I ask them why, they say, ‘I just want to have a dozen chickens, a couple of pigs, a couple of cows...’ They’re not coming here to be a farmer, but just coming here to enjoy life. I think they recognise that they can live comfortably and enjoy a piece of quality land here. This type of customer, I think, will keep coming.”
Key to better success with Chinese
Chen stresses on the importance of understanding both Chinese and American cultures, and how agents can bring both together.
“My position is like a bridge between east and west. It’s like Juwai, which is being the platform to bring people together – I need to advise them on the difference between buying a house in the US and China, as well as give them a heads up on what kinds of challenges they may meet when they try to buy a house in the US.”
Chen further explained that when he talks to potential buyers, a trick he has tried to great effect is to ask them where they currently live.
“When they say Beijing, I ask how they feel about the winter there. If they say it’s too cold, then I will move them a little bit south. But if they say they like the Beijing weather and like to have some snow, then I will put them a bit north, say Maryland. It really depends on several factors,” he explains.
Working with Juwai
“Juwai has been an important partner in China because I find that Juwai is able to provide valuable leads and customer service for the buyer in China – to help them before we connect with them," said Chen.
"Juwai helps me by gathering as much information as they can and passing it to me. I’ve found that when I have difficulty reading a customer, I ask Juwai’s assistance and they are usually able to follow up for me.”