The repercussions of Black Monday could go further than just today’s major hit, with the future of Chinese homebuyers now in question.
The Black Monday market collapse badly dented the stocks that drive the housing and mortgage finance economy worse than the major indices early Monday morning.
The HW 30 — HousingWire’s proprietary list of major players in the space — was down 4.75% as of 10:09 a.m. ET.
In a blog post on LinkedIn, John Burns, CEO and owner of John Burns Real Estate Consulting, explained that Chinese homebuyers comprise roughly 2% of U.S. housing demand—and far more in than that in the gateway metro areas with excellent airport access. As a result, he expresses his increased uncertainty about the level of future Chinese homebuying.
While the recent Chinese stock market correction has caused a decline in sales (one of my builder clients has noticed a sharp pullback, another just told me about a home sale cancellation specifically due to the buyer’s stock market losses, and one publicly traded home builder even mentioned the pullback on their earnings call.), our research has convinced us of tremendous Chinese demand to buy US real estate for their families and as investments.