Irvine built nearly half of the new homes, condos, and apartments in Orange County over the last six years. Certain sections of the city being bought by 80 percent international buyers.

It was no surprise that for the fourth consecutive year, building of multi-family units outnumbered single family construction in California. This is part of the renting trend that has gone on for nearly a decade now and builders are merely catching up. One interesting finding in the data is that for Orange County. In Orange County one city accounted for nearly half of all new homes, condos, and apartments over the last six years. That city is Irvine. What is interesting with Irvine is that parts of the city are being built to cater to a foreign audience. Certain subsections are seeing 80 percent of properties sold to international buyers; we are talking about new homes that are selling for $1 million or more mostly in all cash offers. It is an interesting trend. But what is even more telling is that most of the construction in Irvine was for apartments and condos. Even in an affluent market the renting revolution is occurring.
Building for the renters and the foreign money
I think the situation in Irvine encapsulates a lot of what is going on in the housing market. The vast majority are priced out and the market now understands this. This of course is reflected by builders building multi-family units for the renting majority. Where single family homes are built in Irvine, it is very clear who their audience is. In some cases agents from China will bus in potential buyers that are willing to purchase homes for all cash. Even the way construction is occurring is to cater to this audience. It makes sense after all from the builder’s perspective. They certainly aren’t catering to domestic families.

This post was published at Doctor Housing Bubble on May 12th, 2016.