What are foreign homebuyers looking for in Central Mass.?
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Education and work opportunities draw foreign homebuyers drawn to Central Mass.
For the growing number of young families coming to Massachusetts from China or India, education matters a lot.
So the first thing many of them consult before looking for a home is U.S. News and World Report or Boston Magazine for high school rankings, said Leslie Mann of Gibson Sotheby's International Realty in Weston.
Once the parents identify the school system they want their kids to be a part of, the search likely begins for new construction, said Claire Bett of Realty Executives Boston West in Southborough.
Mann said roughly 70 percent of her international clients want to live in brand new homes.
“I'm always getting asked on the phone, 'When was this built?'”
When a brand new home is not possible, Bett said Chinese and Indian homebuyers usually opt for post-2000 construction since those properties offer the most up-to-date pipes and plumbing systems. This is often a dealbreaker for older towns closer to Boston such as Newton and Needham.
“They are very selective on where they buy,” Bett said. “We are getting a fractured market.”
In the latest round of the residential real estate sweepstakes, good schools and new homes are enabling much of MetroWest to come out on top, several local Realtors said.
Hopkinton, Westborough, Natick and Shrewsbury have proven popular with Indian and Chinese couples, Bett said.
British families – which make up a smaller, yet significant, portion of Massachusetts' international homebuyers — typically opt for older construction on spacious lots in such towns as Sherborn, Natick or Sudbury, Bett said.
Homebuyers from China and India tend to be young couples or couples with young children, Bett said, while British buyers tend to be a little older.
They're drawn to Central Massachusetts by jobs in the health care, technology and life sciences sectors at places such as Natick-based MathWorks, EMC and Genzyme, which has operations in Framingham and Northborough.
Across the United States, the international homebuying market has grown from $39 billion in 2009 to $92 billion today, according to data from the National Association of Realtors (NAR). International sales now make up 8 percent of the nation's $1.2 trillion housing market, the NAR found.
Chinese leading the way
That growth has come largely from Chinese buyers, who now make up 16 percent of the international market, up nearly double from 9 percent in 2010, according to the NAR. Favorable exchange rates have driven much of that activity, with the U.S. dollar having lost 10 percent of its value over that period against the Chinese yuan, said David Noyes of Berkshire Hathaway Home Services in Natick.
But a temporary reversal in exchange rates earlier this year led to a few of Noyes's clients suspending their housing searches, he said.
Homebuyers coming over from Asia or Europe tend to be well-educated and, therefore, have deep pockets.
The median price for homes sold nationwide over the past year to Chinese buyers was $523,000; for British buyers, $350,000; and for Indian buyers, $343,000, all well above the national median price of $200,000 for domestic buyers, according to NAR data.
“We've got a lot of money internationally, and the United States is an attractive place to put your money,” said Jed Smith, NAR's managing director of quantitative research.
For this reason, six of every 10 international clients purchase their homes entirely with cash, the NAR found, compared with just a third of sales to domestic buyers.
International clients have also generated a windfall for Central Massachusetts' rental market, according to Realtors and developers.
Six percent of the 240 units at Hopkinton's Alta Legacy Farms have been leased to international residents, primarily from the Middle East, according to the developer. These tenants are drawn largely from a preferred employer arrangement between Alta Legacy Farms and Hopkinton-based EMC, said Alethea Barrette, Northeast regional property manager for Wood Residential Services, which manages Alta Legacy Farms.
Some of the relocated workers stay for a while in Alta Legacy Farms — which opened in 2013 and offers a mix of one- and two-bedroom units — while others opt to buy a home quickly.
Many international clients look for different features and amenities than their American counterparts.
What buyers want in a home
Bett said she has urged builders looking to serve an international audience to put a second master suite with a bathroom on the ground floor. Chinese and Indian couples are typically close with their extended family, Mann said, and the extra bedroom makes it easy for the homebuyers' parents to stay for an extended period of time.
Feng shui — a philosophy that focuses on the orientation of buildings in relation to energy flow — leads many Chinese buyers to prefer homes facing south, Noyes said, while Hindu beliefs prompt many Indian families to choose homes facing north or northeast. Paul Yorkis of Patriot Real Estate in Medway said he keeps a compass application on his iPhone handy for this purpose.
Yorkis said he has also received requests from many practicing Hindus to have their homes blessed by a priest prior to occupancy.
Many Asian clients prefer to stay away from homes near cemeteries — which they consider bad luck — as well as properties with expansive lawns or lots or trees, according to Noyes and Bett.
People relocating to Massachusetts from abroad tend to find not only a wide offering of ethnic cuisine, religious facilities and social groups, but are also embraced by the commonwealth's longtime residents, said Bett, who moved here from England several years ago.
Basheer Mohammed opened Desi Market in 2008 to cater to Indians, Pakistanis and Middle Easterners who have relocated to the Shrewsbury area over the past 15 years. Meat, fish, frozen foods and dried goods tend to be particularly popular with customers of the Boston Turnpike store, Mohammed said.
“This is a sophisticated, well-educated part of the country,” Batt said. “As a foreigner, you're treated in the best way.” n
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