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January 30, 2015

Real estate, education cross paths as Chinese enrollment at UW jumps 856 percent in 10 years

Puget Sound Business Journal

Marc Stiles

One of the main reasons Chinese nationals are buying up more and more real estate in the Puget Sound area is because they want to provide housing for their children who attend schools here.

It's impossible to know how exactly how many houses people from China have bought in the region, but enrollment data from the University of Washington bear out the correlation between education and real estate.

According to the UW, the number of Chinese students surged nearly nine-fold between 2004 - when Chinese enrollment stood at 356 - and last year when the number hit 3,405. That's an 856 percent increase in a decade. That means the UW Seattle campus, which had a total enrollment last fall was just under 44,800, is about 7.6 percent Chinese students.

UW spokesman Norm Arkans said the Bothell and Tacoma campuses also might have some students from China, but those numbers "would be pretty small."

Wealth in China has exploded due to manufacturing growth. Or as Sophia Wong, a commercial real estate broker at Kidder Mathews in Bellevue puts it, China became "the world factory" a couple decades ago, and the wealth accumulation has been amazing.

Juwai.com, a Chinese international real estate website, last year said there were 643,000 millionaires in China, and that number was growing 14 percent a year, though economic growth has been slowing down.

Holly Yang, another Kidder broker, estimates more than half of the well-to-do Chinese talk about sending their kids overseas to school, or investing in real estate in other countries. Some are doing both.

At the Asian Real Estate Association of America's Pacific Rim Summit in Kirkland last fall, participants swapped stories like the one about some parents paying $5 million for a house for their son, a student at Bellevue College, and how Chinese teens are motoring about town in Ferraris and other luxury cars.

"We see that day in and day out," said Tom Chang, the Northwest Director at East West (NASDAQ: EWBC), an international bank.

Realtor Dean Jones of Realogics Sotheby's International Realty in Seattle last year said his firm helped a Chinese national buy an $8 million Eastside house for his child, who was a recent UW graduate.

Across the nation, more and more Chinese students are enrolling in universities. Citing a report from the the Institute of International Education, a nonprofit group, Bloomberg last fall reported that the nu mber of Chinese university students in the U.S. jumped 75 percent in three years to almost 275,000. Students from China made up the largest number among the 886,052 foreign students in 2013, with 31 percent. India was second with 12 percent of the total, and South Korea was third with 7.7 percent.

For the full story, go to Puget Sound Business Journal.

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