Buyers Guide to California – Education drives prices and rents

Buyers Guide to California - Education drives prices and rents


"California, Here we come" Phantom Planet

(click for an awesome Indie rock song from 2002)

We are super excited to kick off our "Buyer's Guide to U.S. Real Estate" series, where we go in-depth into the main U.S. states for property investment purchases, starting with California!

We also have a surprise guest at the end of the month (see bottom of article)!

What's not to love about the Bohemian vibes of San Francisco, the technology center-of-the-universe in Palo Alto, wineries in Napa, food in Yountville, golf in Steinbeck country, the quaint and exclusive Montecito, and year around perfect weather in San Diego.  

And finally, Los Angeles – Beverly Hills, Hollywood, Venice Beach, Santa Monica, Bel Air, Pasadena, Orange County – it's almost endless. 

It's no surprise that California is a favourite investment destination for our clients, both Overseas Expats and Foreign Nationals, primarily from: the U.K., Canada, Australia, Mexico, China, Hong Kong, Singapore, Philippines, Indonesia, Australia, France, UAE, Germany to name a few.

Want Home Value Appreciation and Rental Income Growth?

Education is key!

Job market growth is certainly a key driver for price appreciation and is normally driven by the new business formation in the area, but popularity as a living destination is driven by things like safety, cost of living, ease of transportation and quality of education, especially for families with young children.   

"Popularity as a living destination" in turn drives demand, home value appreciation, and strong growth in rental income. 

Why is Education important?

In this week's report, we will take a deep dive into Education – an important (if not the most important) factor for overseas property investors in determining where your next home purchase will be in the U.S.

With Foreign National buyers, in particular, the objective of owning real estate to earn income almost always comes down to "could I live there one day"?   

In Asia, where owning property is ingrained in their culture, it's common to purchase an investment property "in anticipation" of sending their child to college. They could even live there during or after they graduate, and the price appreciation could even pay for college if they sell the property. Or, if the child decides to get a job in the U.S., they can stay in the apartment as a post-graduation gift to build up their credit or even rent it out to earn income. 

Which are the top high schools in California?

We look at the top 50 high schools in California, both public and private, ranked by average SAT and ACT scores. As you can see, the SAT scores will range from 1300-1500. To get into a top 25 U.S. university, the SAT scores should be at least 1400 as a reference, so these schools are all great.

Why high schools?

Many new immigrants or returning expats will choose to live in areas where there are good schools and a higher population of similar background families (the latter we will investigate next week). High schools are a very important decision since it will determine their experience during these formative years between 14-18 years old but also potential college choices. 

"Popularity as a living destination" drives demand, home value appreciation, and strong growth in rental income. 

Schools with the highest SAT/ACT scores

- Public: Lynbrook High School, San Jose

- Avg SAT 1450 / ACT 33

- Private: The Nueva School in Hillsborough & Basis Independent in San Jose

- Avg SAT 1510 / ACT 34 for both

Household Income, Home Prices, and Rental Yield

We also look at the Median Household Income, Average Home Prices, and Rental yield in each city. When moving to a new city, aside from the quality of education, most will look at how expensive it will be to live there, own a home, and potential rental income potential. 

It's probably no surprise cities like Palo Alto, San Diego, San Jose, Los Angeles, and others will have higher home prices, but we also look at a rough gauge of affordability which is a "Home Price to Income Ratio," which tends to be where most immigrant buyers choose as their base.

Cities with the highest Median Income

- $250,000+ per annum income

- Cities: Piedmont, Hillsborough, Los Altos

- Neighbouring schools: Piedmont High School, Los Altos High

Cities with the highest Home Prices

- $2,000,000+ home price

- Cities: Piedmont, Palo Alto, Hillsborough, Ross, Atherton, Los Alto, Saratoga, San Marino

- Neighbouring schools: Piedmont High School, Los Altos High, Palo Alto High, Henry Gunn, Aragon High, Nueva School, Crystal Springs Uplands, The Branson School, Menlo High, Pinewood School, San Marino High

Highest Rental Yield

>5% gross yield: Riverside
>4% gross yield: Lo Jolla, San Diego, San Jose, Fresno, Irvine, San Clarita

- Neighbouring schools: Riverside STEM Academy, Canyon Crest Academy, Torrey Pines High, Westview High, Del Norte High, The Bishops School, La Jolla Country Day School, Francis Parker School, The Harder School, Basis Independent, Bellamine College Prep, Notre Dame High, University High Fresno, University High Irvine, Woodbridge High, Arnold Beckham High, TVT Community Day School, Academy of the Canyons

America Mortgage Concierge Program

We launched this free service last month to connect potential home buyers with our approved panel of realtors in each major U.S. city, which only focuses on overseas buyers. If you would like to learn more, please contact

Our surprise guests!

At the end of August, we will be hosting a webinar with our California partner, who will present a "Guide to California Real Estate" along with a panel of the top realtors in Los Angeles, Orange County, and Bay Area to give you a real "on the ground"feel for all the points we discussed above and more.   

Stay tuned…this is going to be amazing! 

Sources: Niche, City-Data, US News, OECD data, US Census Bureau and respective school websites

Showing off our ABS (Asset-backed Solution),

Asset Backed Solutions (ABS) GMG Asia

If it "Flies or Floats", we can Finance it!

Cyclical industries, by definition, are heavily leveraged and also mean those that can time the business cycle do very well, and those who can't will likely face financial difficulties. Covid-19 has magnified the amplitude of this market structure.

Another way to look at this is that those who have excess liquidity can take advantage of distressed sales, and those that don’t will need to raise liquidity in a short period of time to pay down debt.

GMG "Asset-backed Solutions" (ABS)

Similar to our popular real estate bridge loans, GMG Commercial Vessel and Private Jet Loans are able to monetise the equity in the "asset" and provide our clients with the necessary liquidity in ways traditional banks are unable to (speed to close, high LTV, interest-only etc).

Commercial Vessel Loans

Some of the largest shipping companies in the world are based in Asia, given the proximity to important trading routes. This gives GMG a natural advantage to work with our Asia-based UHNW clients in the shipping industry who need liquidity options on their vessel fleet.

Private Jet Financing

The global downturn in air travel has created strong demand in private aviation as UHNW clients have pivoted to owning private jets given the lack of commercial travel options as a result of Covid-19.

Our investors specialise in private jet financing, offering flexible terms and fast funding times.

Here are 2 recent case studies highlighting GMG’s ingenuity in creating liquidity solutions for our UHNW clients to now include commercial vessels and private jets.

Case Study links to:

Private Jet Financing
Commercial Vessel Financing

Please contact me directly if you want to learn more about our ABS.


Donald Klip, Co-Founder

Introducing “BREFI” (pronounced /brèːfè/), a New Loan Programme by GMG

New Loan Program by GMG Asia

Over the past 12 months, the most common funding problem is the lack of financing options at the early stages of a real estate project: land acquisition, initial development, real estate purchase before the renovation, equity cash out towards new development, etc.

GMG receives high-value financing requests in almost all major countries, and it’s been very clear that traditional banks are less willing to take on the risk of financing the early stages of a real estate development or project. There has never been a greater need for non-bank alternatives than now.

Many of our High-net-worth clients have relied on the ‘long relationship’ with their banks (Implicit Put option) to be their lender of last resort, and when they are not, there is a scramble for financing options in a short period of time, which we see now. A separate issue is that banks, in general, may require recapitalization from losses due to Covid-19 and are looking to preserve capital.

Bridge Lending (the B part of BREFI).

As many of you know, one of the advantages of bridge loans is that they allow the borrower to secure opportunities that you would otherwise miss. Another advantage is bridge loans allow for flexible payment terms depending on the loan agreements. You can choose to start paying off the loan before or after securing long-term financing.

Also, qualifying and getting approved for a bridge loan takes less time than a traditional loan, giving the borrower the convenience of quickly owning the asset and begin getting the project off the ground with the intention of replacing the bridge loan with a more permanent construction loan, as an example.

GMG BREFI (short for Bridge + Refi).

We created the BREFI to combine 2 types of mortgage origination effort into one single offering to help clients with their initial bridge and onto the next stage of funding, usually a construction or development loan.

For example, in some cases, the initial bridge loan is used to purchase the property or land and prepare it to be “Shovel-ready.” That is land or structure that has plans, zoning, and issued permits in place. Having these ready allows for construction to begin immediately after closing.

A major difference between these two is that new construction loans fund the construction of a new structure, whereas bridge loans allow investors to purchase land or property but typically do not fund any construction costs. A GMG BREFI combines them both into one service offering.

Investors who obtain a bridge loan will usually begin construction after they have refinanced out into their long-term loan.

Typical Bridge Loan

  • Used to purchase “shovel-ready” land or land with an existing structure for a quick flip
  • Used to pay off the existing loan by refinancing into another loan
  • Not normally used to fund construction

Typical Construction Loan

  • Used purchase "shovel-ready" land or land with an existing structure to tear down and rebuild
  • Used to pay off the loan upon selling the property
  • Always used to fund construction

Our team uses GMG BREFI by finding lenders that will take both portions of the funding stack, Bridge + Construction.

Some common uses of GMG BREFI

Purchasing a plot of land to build a new development

Investors looking to purchase a plot of “shovel-ready” land would normally use a construction loan which is not available in this market environment. A BREFI will allow you to acquire the desired land and finance the new development on the property.

Purchasing an existing property (IE en bloc in Singapore) to tear down and build a new one

For clients planning to tear down and rebuild a structure on a piece of land, a BREFI can be used as a financing option.

Financing required to purchase land and begin construction immediately

Property developers who have the required documentation to begin construction on a piece of land can use the BREFI, where typical construction loans are not available with traditional banks. The hardest part of any new construction is getting the needed permits; once this is done, our lenders can disperse the funds in “construction draws” to start building.

We have many Case Studies for the GMG BREFI for transactions globally.

Please contact your GMG International Loan Specialist for more information:

The Roaring 2020s?

The Roaring 2020s

The “Roaring 20’s” is often considered as one of the most prosperous times in the West. WWI had just ended, and the housing market’s growth, the development of infrastructure, telephone networks, automobiles, etc., was the centerpiece of growth. America’s wealth more than doubled in the years between 1920 and ’29 with most of the wealth invested into finance and industry but there was enough trickle-down to lower-income earners to help buoy a new consumer culture.

Doesn’t this sound familiar?

In 2020, FAANG stocks (our version of industrial stocks in 1920s) doubled as well!

Meanwhile, as the world heads towards being incrementally more vaccinated, we are seeing inflation expectations rise, the first wage growth in over a decade, and a potential $3T infrastructure plan in the U.S. which draws some comparisons to FDR’s The New Deal.

Personally, I find it remarkable how the global macro narrative has shifted 180-degree only one year out from the start of a global pandemic, and also not far from when the discussions among leading economists were ‘when’ deflation would happen, not if. Now consensus, in under 12 months, has gone from deflation to inflation.

If you are looking for evidence that inflation is back, look no further than housing prices. Knight Frank reports that worldwide home prices rose 5.6% in 2020, and CoreLogic says U.S. home prices increased 10.4% year-on-year in February 2021, the highest in 15 years!

Taking some data points from Knight Frank’s survey, look at the annual % change in home prices in the major cities that Global Mortgage Group offers mortgages in.

Can you guess which city had the highest growth in the U.S., U.K., France, Canada, Australia, and Singapore? Read here to find the answer!

Phoenix, California+14%
Seattle, Washington+13%
Los Angeles, California +10%
New York City, New York+10%
Atlanta, Georgia+8.9%
Dallas, Texas+8.4%
Miami, Florida+9.2%
Geneva, Switzerland+7%
Lyon, France+8.9%
Paris, France+7.7%
Sydney, Australia+4.5%
Brisbane, Australia+4.2%
Melbourne, Australia +3.6%
Manchester, UK+8.7%
London, UK+4.3%
Montreal, Canada+15%
Toronto, Canada+10%
Vancouver, Canada+7%

Sources: World Property Journal, High Finance,

American School in Bangkok offers GMG U.S. home mortgage seminar for their teachers and staff

American School Bangkok offers GMG U.S. home mortgage seminar for its teachers and staff

The Client

One of the American curriculum schools in Bangkok wanted to offer their teachers the benefit of learning about U.S. mortgage loans.

The Property

Multiple locations

The Deal

GMG U.S. mortgage financing seminar explains the pros/cons of obtaining a U.S. mortgage in a clever and informative two hour class.

The Challenge

Foreign earned income. No W2 for U.S. citizens. Lack of credit. Some teachers not being U.S. citizens.

The Solution

GMG loan officers explained the options for U.S. Expats and for non U.S. citizens on how they can purchase or refinance U.S. real estate specifically for their situation. Being an Expat shouldn’t keep you from getting the exact benefits as any U.S. citizen when allying for a U.S. home loan. GMG are experts in U.S. Expat financing.

Loan Details

Loan TypeProperty ValueLoan AmountLTVGMG Program
Purchase or Refinance (class)min property value $150,000 min $100,000 - max $5,000,000up to 80%GMGUS Expat-2
Loan TypePurchase or Refinance (class)
Property Valuemin property value $150,000
Loan Amountmin $100,000 - max $5,000,000
LTVup to 80%
GMG ProgramGMGUS Expat-2

Overseas Investor uses GMG bridge loan to purchase cannabis facility

Overseas Investor uses GMG bridge loan to purchase cannabis facility

The Client

Indonesian business man with numerous business and real estate assets around the world.

The Property

Mixed use commercial property in Reno, Nevada.

The Deal

To secure a 12 month bridge loan to purchase another property in California.

The Challenge

Client had several business around the world, Indonesia, US, Canada and Thailand. While some businesses have been very successful others have struggled due to increased competition and tighter regulation. Showing current financials would be challenging.

The Solution

GMG engaged a pocket asset based lender with the understanding of the complex financial structure of each business/entity. Equity release from the commercial property in Reno, NV was sufficient enough to structure a purchase. 12 months later both properties were refinanced into low interest commercial structure loans.

Loan Details

Loan TypeProperty ValueLoan AmountLTVGMG Program
Refinance / cash out$3,450,000$1,500,00043%GMGUS Bridge 1
Loan TypeRefinance / cash out
Property Value$3,450,000
Loan Amount$1,500,000
39%GMGUS Bridge 1

Chinese National closes US$5.6m purchase with GMG Bridge

Chinese National closes US$5.6m purchase with GMG Bridge

The Client

A married Chinese couple with a five-year goal of having their children study in NYC purchase a luxury condo.

The pair were looking to for a safe, investment grade condo near NYU for their two twin boys to study at the same university as their family in 5 years.

The Property

A luxury two bedroom Washington Square condo within walking distance to NYU.

The Deal

Non US citizen with no US credit. Looking for 65%LTV.

The Challenge

Property was being sold “fire-sale” and clients needed to act quickly as there were multiple back-up offers.

The Solution

As time was of the essence, the clients did not have time to organize their financials GMG suggested a quick close with GMG Bridge and then within six months refinance into a long term, fixed mortgage at a significantly lower rate.

Loan Details

Loan TypeProperty ValueLoan AmountLTVGMG Program
Bridge Purchase$5,600,000 $3,640,000 65%GMGFN Bridge
Loan TypeBridge Purchase
Property Value$5,600,000
Loan Amount$3,640,000
GMG ProgramGMGFN Bridge

Couple In Their 70s Refinance Their Existing Investment Property To Release Cash

The Client

A married Singaporean couple in their early 70s living in Singapore with a small portfolio of U.S. investment property. The wife works and owns a small marketing company whilst the husband is retired. In addition to their home, the pair also own two rental properties.

On advice from their trust attorney they were also hoping to increase their LTV to mitigate U.S. inheritance tax, and convert their current rental mortgage into an interest only to increase their yield.

The Property

A large six-bed family home in Vail, Colorado. The couple had purchased the house over 20 years ago when living and working in the U.S..

The pair were looking to reduce their credit card debt, and help their son purchase a home in Singapore.

The Deal

In total they were looking to raise $300,000. They had requested a five-year fixed rate on interest only terms.The clients felt that their advanced age of the applicants and their low income would decrease the finance options available.

The Challenge

The clients were not current on their U.S. tax filings for their rental property, were in their late 70s and had sufficient but not well documented income.

The Solution

As a significant amount of their income was based on future contracts, but their cash flow was sufficient to service their debt, we suggested our FNStated program which would enable to the borrowers to qualify for a higher LTV based off projected income and net rental income from the property.

Age wasn’t a factor, as it is illegal to discriminate against age in the U.S.. GMG was able to structure a 30 year amortized mortgage with a 5 year interest only period giving the needed $300,000 cash in hand and reducing their monthly debt servicing by 13%, thus increasing their yield.

Loan Details

Loan TypeProperty ValueLoan AmountLTVGMG Program
Refinance Cash-Out $1,450,000 $1,087,000 75%GMGFN Stated
Loan TypeRefinance Cash-Out
Property Value$1,450,000
Loan Amount$1,087,000
GMG ProgramGMGFN Stated

What Is Bridge Financing And How Does It Benefit Investors?

For those who are new to investing in real estate, a common question is, what is bridge financing? A better question is, what is bridge financing and how does it benefit of commercial Real Estate investors?

For investors that are well versed in bridge financing, you understand the importance of having access to reliable and reputable bridge lenders.

Bridge financing is short-term financing, sometimes referred to as private money, smart money or hard money. Bridge loans are typically made by private individuals and not banks, so the interest rates on bridge loans are higher than bank loans. International bridge lending allows non U.S. citizen / Foreign Nationals to invest in US or other global Real Estate projects by providing the needed capital in a quick and efficient manner.

Many of the commercial real estate investors who were able to purchase distressed commercial properties in recent years made out very well. In order to act on multiple opportunities at the same time, many real estate investors have turned to bridge financing.

Bridge financing benefits investors in 3 important ways:

1. Bridge financing allows investors to make their money go further. For example, if two properties come together at the same time, an investor can purchase both properties using a bridge loan on each purchase.

2. Bridge financing removes partners or family members from a deal. Investing with family members or business partners can be tricky. Bridge loans can remove other partners from the equation, allowing an investor more freedom and flexibility with a newly acquired asset.

3. Bridge loans fund faster than bank loans. If an opportunity is good, it won’t last long. Bridge loans have less requirements than bank loans and thus close quicker. Bridge financing allows investors can grab a fleeting opportunity before another investor snatches it up.

International bridge financing for global / invernational real estate projects?

Global Mortgage Group extensive network offers numerous options for Bridge Financing regardless of your citizenship. Whether for a hotel project in Spain, land in Thailand or a dairy farm in India, GMG is your solution for reliable capital sourcing.

Our capital network and experience for international bridge lending expands borders.

With over 70 combined years of experience in the mortgage and investment banking industry, and with access to funds around the world, GMG will consider most international bridge funding requests. Currently we offer bridge lending on international and foreign borrowers with a minimum loan amount of US$3mm with no maximum with a maximum of 50%LTV/LTC.

"We close loans, others can't"

GMG Partners