Asian immigrants find robust niche market in real estate
By Adam Smith, Sampan
Boston – Apr 7, 2006 – When Kai Lau first started selling real estate part time in 1985, he knew of only about two Chinese American realty agencies in Boston. Now, there are more than he can count.
Over the last several years, he said, the number of players in this niche market has “increased drastically.”
And with two decades in the business, he should know. After getting into real estate as a way to make extra cash on weekends and holidays, he eventually traded in his day job as an engineering supervisor to run his real estate business, Cantonese World, full time with his wife and daughter.
Though it’s difficult to find the exact number of Asian American realtors in Massachusetts, several factors indicate an ever-increasing presence: a review of state licenses for the industry shows that hundreds of people with Asian surnames have gotten their real estate sales or brokers licenses in Massachusetts; ads for real estate and mortgage agents fill up the pages of several Asian-language newspapers; and anecdotal evidence from Lau and others suggests increasing competition in the field.
Nationally, the presence of Asian American real estate agents also appears to be significant. Jim Park, president and CEO of the California-based Asian Real Estate Association of America, speculates that as many as 100,000 people of Asian descent are in the business. He cautioned, however, that calculating an exact number is difficult because fewer Asian American realtors join mainstream real estate associations than their non-Asian counterparts do.
“A lot of them are not necessarily a part of the traditional real estate network,” he said.
With some caveats, sheer population increases could point to an increasing demand. In Massachusetts, the Asian American population grew by 70% from 1990 to 2000 and is now nearly 240,000. Nationally, nearly 12 million people identified themselves as Asian American at the time of the 2000 US Census.
But simply counting population increases can be misleading, because in cities such as Boston, the rate of homeownership among Asian Americans is significantly lower than what it is for whites and African Americans (though it’s higher than the rate for Latinos) according to the study, “Asian Americans in Boston,” released in 2004 by the Institute for Asian American Studies at the University of Massachusetts Boston. Nationally, the trend is similar. The homeownership rates for Asian Americans lag 20% behind the rate for non-Hispanic whites, according to a 2004 study commissioned by the Asian Real Estate Association of America in partnership with the Asian American Studies Center at the University of California in Los Angeles.
But just as most others in America, the ultimate goal for many Asian Americans is to eventually own a home.
“The first priority of any Asian immigrant is to come here and buy their own home,” said Lau. “Owning a home is the American dream; it’s also the Chinese dream.”
He said when he first got into the business in the 1980s, many Chinese immigrants would come to the U.S. with very little money, work long hours and save money by living in small apartments in Chinatown, and after several years, buy a home. Now, he said, more new immigrants come here with some savings — perhaps by selling off a condo they owned in Hong Kong — and are ready to buy sooner than the previous wave of immigrants was.
“The living standard has been increasing,” he said.
Another sign that the niche market is developing, he said, is that more and more salespersons and brokers are dealing with commercial property and not just residential.
Lau’s biggest project was commercial: He located a 90,000-square-foot space for the Kam Man mall in Quincy, Mass., and has since been helping lease kiosk space to business tenants.
But as the market expands and more realtors start their own businesses, competition has also increased.
“It seems that recently, more new (Asian American) real estate companies have been starting up,” said Eliza Chow, a former school teacher from Hong Kong who runs American Fortune, a real estate agency in Brookline. “Nowadays, there is more competition.”
“If you look at the World Journal (a Chinese-language newspaper), you can see at least 40 to 50 (advertisements for) real estate offices and brokers,” said Lau.
Other Asian Markets
The Chinese real estate market is not the only local Asian market. Deukhan Son serves Korean immigrants and long-term Japanese visitors to Boston. Unlike Lau, Son came to the U.S. with the intent of entering the real estate business. A native of South Korea, Son studied real estate science at Tokyo University before coming to the U.S. about six years ago. Son said he came to the U.S. because he wanted to “play in the big market.”
He said the Korean market is too small and Japan’s is too slow. But in the U.S., he said: “We can see a lot of land and house building. It’s a huge market…and it’s a big business, which I love.”
Like the Chinese American market, the Korean American market is also looking to buy, according to Son.
When asked if there is a difference, however, between the Japanese and Korean market, Son said: “Many Koreans want to buy houses, and most Japanese want to rent. The Japanese want to go back to Japan after several years. Koreans want to stay in the U.S.”
Son’s observation fits demographic trends: Japanese, when compared with other Asian subgroups in Massachusetts, have the lowest citizenship rate, according to another study from UMass-Boston’s Asian Institute. And his observation is also shared by others in the business.
“Japanese people tend to rent compared to other foreigners,” said Miho Sato, who runs Urban Realty Group. Sato got into the business 10 years ago after thinking it could support her opera singing.
Because the Japanese population in Massachusetts is so small — about 10,500 — Sato said her Urban Realty Group serves mostly non-Japanese, though it offers Japanese-language services and advertises in local Japanese publications such as J-Magazine.
Still, she does provide a niche service that her non-Japanese-speaking counterparts can’t provide.
“If they’re a newcomer, I’m sure they feel more comfortable working with Japanese” when seeking housing, she said.
She speculated that one reason Japanese rent instead of buy is because many are leery of real estate markets after the Japanese housing market went bust in the 1990s.
Hiromi Foss, who runs Mikasa Global Realty and works with Japanese clients as well as others, has another thought about why few Japanese buy locally. She said that many Japanese come to Boston for temporary work or as university students.
Sato and Foss agree that one surprise many Japanese renters often face when first finding an apartment in Boston is how expensive and old most buildings are.
“In Japan,” said Foss, “they expect perfection. If they are renting an apartment, they want to move into a perfect place.”
Same Language Doesn’t Mean Quality
Though it’s easier to do business in a native language, consumers must still be selective, said Jim Park of the Asian Real Estate Association of America.
“Most in the Asian community are immigrants. They prefer to (conduct business) in their own language (and) they tend to want to go to people who understand them,” he said. But, he said, the consumer “needs to be fully educated.”
“Unfortunately in this business, there are some people…who are not as scrupulous as others,” said Park, who recommends interviewing several agents and getting referrals.
“It’s important to choose a real estate agent wisely, to know their background and how much experience they have,” said Jennifer Chen, who’s been in the business for two years.
Eliza Chow, who is on the board of the Greater Boston Real Estate Association, also suggests considering if the agent is a member of a reputable real estate association. Such associations, she said, often provide realtors with up-to-date information on new legislation affecting the business, such as the recent law requiring carbon monoxide detectors in homes.
In Massachusetts, consumers can ensure their agents are properly licensed by contacting the Board of Registration of Real Estate at (617) 727-2373.
As for those considering getting into the business itself, it can be competitive and lots of hard work. But it can have its rewards, as Lau, owner of Cantonese World, has discovered.
“I’m doing okay,” said Lau. “I’m raising three kids and two have graduated from college — all their tuition was paid by my commissions.”
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