Seattle favored by wild geese families
This is the third in a series of articles exploring high-potential property markets in the U.S. amid the collapse of the real estate bubble. — ED.
By Jane Han
NEW YORK — For many people, Seattle is just a city where it rains a whole lot. But for Korean parents serious about their child’s English education, it’s a place that packages both education and real estate investment.
Home to a large crowd of Korea’s growing number of “wild geese” families that choose to live separately to school their children in English-speaking countries, Seattle is also one of the most active property markets in the U.S.
“There’s a reason why so many Korean parents choose Seattle for their kids,” says Paul Kim, a property investment advisor at Regency. “The city not only has some of the best schools in the country, it also offers an opportunity for parents to make money.”
Kim, who services investors exploring mainly New York, Seattle and Los Angeles, say parents with children most often choose Seattle after doing the math since prices run less than the other two cities.
“It’s a heavy burden for them to send thousands of dollars every month,” he said, “so what they do is purchase a condo or two in Seattle and use the monthly rent to support their kids.”
David Cho, an agent at John L. Scott, says many of his clients do the same.
“People sell their expensive Gangnam apartments, trade down and use the remaining money to invest in income-generating property here,” he said, adding that condos and commercial real estate such as shopping plazas, are typically the most popular.
A luxury two-bedroom, two-bath high-rise condo in Bellevue, a popular affluent neighborhood, goes for $500,000 to $700,000, which leases for about $2,500 to $3,000 per month.
Shopping plazas that cost about $1 million bring in about $7,000 to $8,000 in monthly rent, according to Cho.
“These are popular among fathers who are executives at major companies back at home in Korea,” he said. “They buy one of these to make sure the monthly rental income fully provides for their children.”
Experts say the areas sought after by Korean investors are strictly limited to the Bellevue district largely because of the school system.
“There’s been a sharp rise in activity and inquiries from Korea over the past six months,” said Cho, who was careful to say prices have hit bottom.
Current prices are generally down about 30 percent from a peak in July 2007, based on government data.
Seattle realtors claim that the city’s top employers, including Boeing, Microsoft, Amazon and Costco, are going to help lift the sagging market once they start hiring more.