I once interviewed a banker who made the following statement: "People have to eat, people have to go to the bathroom and they need a place to sleep, so if you sell food, toilet paper or real estate you're always going to make a living."
When I obtained a real estate license in 2004, this appeared to be true, although when the real estate bubble burst a few years later, I realized that no one buys a home with the frequency of food or toilet paper.
A recent underemployment statistic in New York City real estate showed that there are more brokers than deals, as confirmed by numerous sources. According to the Real Estate Board of New York (REBNY), there are 25,640 licensed brokers in New York -- excluding the other boroughs. I realized that if 10,000 transactions (10,060 in 2010, according to Miller Samuel) take place over the course of a year, people were still buying NYC real estate; I just had to find them.
One of the reasons the real estate bubble came about was because banks were making "no doc" loans, meaning they would lend money to anyone without documentation (job, salary) often based solely on a person's credit rating. It turned out that many of these people could not make their mortgage payments and foreclosures ensued. Suddenly, even the most qualified buyers found getting a home loan to be an arduous process.
So, I began a quest to find cash buyers and my journey led me to China. I haven't actually made the trip there, but thanks to phone, Skype, and email, I've made many virtual excursions which have resulted in numerous contacts and new clients. Although I've yet to make a sale to a buyer from China, the prospects look extremely promising. I've found that my Chinese clients are not only interested in buying a New York City apartment for themselves, but for their children as well.
One of my colleagues, Lawrence Lee (Keller Williams NYC), recently sold a one bedroom apartment (359 E. 68th St.) for $610,000 (all cash) to a buyer from Shanghai. The new owners consider this a potential home for their children, should they eventually choose to attend college in New York. Meanwhile, they have rented the apartment to someone at $4000 a month.
Lee has strong relationships with bankers and wealth managers in China who refer him clients seeking to invest their money in the United States, specifically in New York real estate.
"When one door closes, another opens," said Lee.
For those of us battling underemployment, it's sound advice. We just have to find the right door.
Follow Rob Taub on Twitter: www.twitter.com/robmtaub