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Comment by forrestthewoods | Hacker News Reader

It could be worse. The Chinese could be buying everything like they do in Vancouver and are starting to in Seattle. I believe the number I heard was 1/3 of Seattle 1 million plus dollar homes in the east side was Chinese. I have more than a few friends renting condos which are owned by Chinese buyers who bought sight unseen.

It'll get worse before it gets better, unfortunately.

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Citizenship requirements to own property, like Mexico has, would be fantastically appropriate.

The Philippines, too, and probably a lot of other countries I can't remember at the moment.

Unlikely to be allowed, as the cash coming from China to buy up property is considered trade surplus.

What is really galling is that from what I hear, a lot of the cash leaving China to buy property are often illicit fund. In a way, US housing is being used as a money laundering scheme. Not just from China but Russia and other places.

This is not going to get any better for awhile.

Have you a citation? I don't doubt you but if you can provide a reliable cite, I'd be into writing a letter to my congresscritters.

This isn't strictly a citation about illicit money, but the NYT has done a yeomans job of trying to understand who is buying so much high end real estate in NYC.

This article is a kind of index summary of their very comprehensive multi-part series. It's worth reading if you are interested in how opaque this stuff is:

http://www.nytimes.com/2015/02/08/nyregion/the-hidden-money-...

Great, thanks.

It happens that a close friend of a close friend owns quite a lot of high end NYC real estate. He offered me a job back in the day, but I didn't want to leave Santa Cruz.

I expect he's a busy guy but perhaps if I asked the right way he might have some interesting things to say.

I may be busted flat and out of work, but in part that's because I generally don't care to find work through personal connections. That is I won't ask a friend for a job, I'm cool with getting work through professional colleagues. Another friend of a friend is the governor of california, another friend is a top hollywood animator.

I know one specific individual who had two hundred million dollars in cash back in the early zeroes. While he kept it invested it was not hard at all for him to liquify it.

You'd think this guy would own a lot of stuff but really he didn't. I had quite a hard time figuring out what he found rewarding from all that money. He wanted more of it, but I don't have the first clue as to why.

He drove a very modest car, his office was a complete shithole. I never visited his home but expect it was modest at best.

This fellow was, in the strictest sense of the word, "honest", I mean he didn't steal his money at gunpoint, or sell drugs.

There are a lot of people like him. I expect he would come to regard long-term investments as - for whatever reason - preferable to the commodities he usually traded.

I am not saying all rich people are bad or stole it. But give the article a read.

Also, what I heard is that it's not easy to take out cash out of China into a foreign country, unless you have connections. That makes you think a bit.

Taking away citizens' right to sell to whomever they wish is not a moral solution.

You're being donwvoted for not sure what reasons, but it baffles me that almost 200 years after we found out that things like the Corn Laws do not actually work (quite the contrary) there are still smart people who think the opposite.

Corn Laws - what do they have to do with selling real estate internationally?

> Taking away citizens' right to sell to whomever they wish is not a moral solution.

http://en.wikipedia.org/wiki/International_Traffic_in_Arms_R...

We do regulate to whom we sell specific things (real estate is obviouly not exactly the same) but allowing international kleptocrats to launder / hide their money in western cities is hardly the most moral choice one could propose.

edit: I'm not opposed to such legislation on moral terms but I don't think I can trust the state with enforcing legislation like that - finding a good way of treating real estate investment funds or long chains of shell companies seems extraordinarily difficult (it already is pretty hard to trace who owns what internationally).

It's about imposing tariffs on across-the-border transactions.

> but allowing international kleptocrats to launder / hide their money in western cities is hardly the most moral choice one could propose.

This would be a political decision which should be treated as such.

Corn can be transported across the border. Real estate cannot.

The real estate market needs slightly different analysis from normal free market dogma because it's subject to the constraints of physical space: you can't just make more of it. If high prices increased the availability of plots in downtown Portland then the problem could solve itself.

They were saying the same thing about corn and other agricultural products, even more so, as people lives' literally depended on them. This was of course before the "green revolution" when, as you said, they couldn't just "make more land" to grow extra corn. It turned out things were better for both consumers and producers once cross-border transactions of corn were liberalized.

Capital controls used to be a thing back in the Bretton Woods era. They were abolished as everyone likes the sound of foreign money coming in, without realising it can be as dangerous as massive cash outflows.

Running the property market as an export market is not a long term sustainable solution.

The growth of remote work could ease some of this effect. If your employer's offices are located in SF or Portland but you don't have to live there, it seems counterintuitive for many types of people (esp. families) to pay to play in those markets.

Ironically, many San Francisco companies are opening offices in Portland, as they can't find enough local staff.

But most don't permit remote work - otherwise one could remote into SFO.

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