In the American Express commercial, Jerry Seinfeld put the nossel into his car’s gas tank and began to pull the handle to fill his tank up as he screamed out, “Release the Hounds!” That statement reminds me of the anticipation of the wave of Chinese toursit expected to come visit the U.S. in the upcoming years.  In a sign of things to come, China has opened up vacation package tours to the U.S.  Is this the beginning stage of the boom to be?  The beginning to “Release the Hounds?”  The first arrivals are already here as isles welcome the influx of tourist.

Chinese tour groups left for Hawai’i and other places in the U.S. yesterday under a new agreement that the American travel industry hopes will bring in billions of dollars.

An initial group of more than 200 tourists was flying in from the cities of Beijing, Shanghai and Guangzhou for a 12-day visit that will take them to destinations such as Hawai’i, New York, Washington and Los Angeles. The trips cost about $4,000 each.

Chinese with visas have long been permitted to travel to the U.S. but the agreement signed last December considerably eased the way by conferring China’s “approved destination status” on this country.

Chinese travelers on average spend upward of $6,000 per visit to the U.S. — more than residents of any other nation — according to U.S. Commerce Department calculations.

Some of those who have had already arrived and have had a chance to do some sightseeing say they believe Hawai’i will become a major tourist destination for Chinese travelers.

I know it is just a start but changes seem to be occurring monthly with regards to an ease in visiting restrictions.  Ultimately the economic upside of this will prevail.

The first group to arrivewill be this week and will be greeted by Gov. Linda Lingle.  FHB changes to accept China Union Pay bankcard.

As mentioned before we are anticipating the easing of tourist visa restrictions in various countries in Asia.  Well…in the Honolulu Advertiser we see:

Hawai’i’s visitor industry is getting ready for an expected surge in tourists from South Korea once visa restrictions are eased, which could come as early as year’s end.

Hotels and other players in the visitor industry are now joining the effort launched by state tourism officials several years ago to market Hawai’i to South Korean visitors.

The power of the global economy has put Hawai’i in a great position to generate meeting and incentive business from Korea, and HVCB is seizing the opportunity,

There really isn’t a lot to cover in this article other than the POTENTIAL.

Coming to America…the land of opportunity.  As I have been saying for a while (The Beginning Stages of Things To Come & The China/Asia Real Estate Boom Debate) U.S. government is starting to ease travel restrictions for Chinese tourists to the U.S.  (Read Also More News From China)

What does this mean? 

Economists are predicting that a wave of Chinese tourist flush with cash will be arriving on U.S. shores soon. (This is the BEST article I have seen (heard/audio) that details what could be expected to come from the Chinese marketplace.  In other words, you have got to listen to this one!)

Consider this information:  In 2006, 17 million Chinese vacationed in Europe and only 300,000 vacationed in the U.S. due to travel restrictions. 

The average Chinese traveler spends on average $6,000 U.S. dollars on their trips.

Within the next 5 years, it is anticipated that Chinese visitors will make up the largest over-seas traveler to the U.S.

Image a place that is roughly midway between the mainland U.S. and Asia.  A place that is a part of the United States, which happens to be considered the most stable and powerful economy in the world (I know it looks a little shaky right now).  Now imagine a place where the weather is absolutely beautiful all year around and is considered by most in the world to be paradise.  Image the number of Chinese that would love to own a vacation property or investment property in that stable U.S. economy, in that state that is closer than the mainland U.S. and is considered paradise.

Catch my drift?

I don’t much care that it was up, it is more about why Hotel Occupancy was up, than the fact that it was up.

Hospitality Advisors President Joseph Toy said the increase was fueled by a big increase in visitors from Canada — up 31.6 percent — convention-goers, sports travel and an upswing in independent travelers.

The state Department of Business, Economic Development and Tourism reported last week that visitor arrivals rose 5.9 percent in February to 603,689 visitors, helped in part by an extra calendar day because of leap year. Still, excluding the extra day, those arrivals rose 2.8 percent.

It is also good to see that room-rates are still increasing as well.

 In the article: Boom In Tourists From South Korea, China Expected:

The combination of a booming economy and easing of travel restrictions from China and South Korea have tourism marketing officials predicting the number of travelers arriving in Hawai’i from those two Asian nations will double within two years.

The upbeat assessment was delivered yesterday at the Hawai’i Tourism Authority’s spring marketing update at the Hawai’i Convention Center. “Korea is exploding,” said Michael Merner, managing director of Hawai’i tourism marketing for South Korea, China and Taiwan.

Travel from that country has been hampered because visitors needed a visa, but South Korea is expected to be admitted to the U.S. State Department’s visa waiver program in early 2009. Merner said Canada’s tourist numbers skyrocketed when it included South Korea in its visa-waiver program in 1994, with an 81 percent increase in arrivals the first year.

He said South Korea is an especially promising market because of the large number of people there who like to travel. Last year, he said, 13 million South Korea residents traveled overseas out of the entire population of 48 million. That’s 28 percent of the total population. Merner said travel has been helped by a strong economy there and a reduction in the workweek from six to five days.

This is along the lines of what has been predicted by several local economist and what I have covered in earlier posts in the Asia Categoryof my blog, so plan your investments accordingly.  With a booming economy, rising wealth in those countries, relative close proximity to Hawaii compared to the mainland, and Hawaii (U.S.) being a stable investment location, I can’t see how we wouldn’t see a large impact on the housing market.  Any thoughts?

I have mentioned it before, and might as well again.  We have seen more foreign investors entering the real estate market here in Hawaii recently.  Need a reason why?  Just look at our currency.  Dollar hits 3 year low against the Yen. 

In more growing economic news from China, we see China’s stock market close at a record high of over 6,000 points. Let me sum this up for you:

Chinese investors have taken irrational exuberance to entirely new levels. On Oct. 15, the Shanghai Stock Index blasted through the 6000-point mark, and closed at 6337 on Oct. 17, up an astonishing 125% since the beginning of the year.  The Chinese market has more than doubled in value so far this year and sextupled in two years.  “It’s totally out of control,” says Carl Walter, a managing director at JPMorgan.

As the article states, it looks like China is headed towards a correction as the rapid rise look unsustainable.  Still China’s economy is growing at double digit growth rates.

Compare that to the article about the US economy.  The money that is creating wealth in the Chinese market, could be similar to the money that was made in the late 90’s early 2000’s in the US, which helped lead to a boom in real estate.  Asia has is being eyed as the next big market boom for Hawaii real estate.  Lets see what happens.

The sprint for more business is on, as Marriott plans to quadruple the number of properties it has in China by the year 2013.  This article had some great quotes and info as to why I keep an eye on China as a future market for Hawaii real estate. 

Marriott International, which has opened 24 hotels in mainland China since 1997, has sped up development in a bid to win more customers in an economy that surged 11.9 percent in the second quarter, the fastest pace in 13 years.  “This is where it’s at,” Marriott said. “People from all over the world are coming here to do business.”  Retail sales in China rose 17.1 percent from a year earlier in August, the fastest pace in more than three years. Disposable incomes for urban households rose 14.2 percent in the first half from a year earlier. Hotel room bookings at Ctrip.com International Ltd., China’s biggest online travel agent, surged 42 percent to 2.41 million nights in the second quarter from 1.7 million a year earlier.

The Chinese government is very concerned about the rapid rise in inflation in China that has sparked 5 interest rate hikes this year alone.  China’s economy is anticipated to grow at a rate of 11% this year alone.  Compare that to the US at 2.3% growth rate.  Rapid inflation is a particular concern for food prices which would effect China’s poor majority population.  So…in response, the Chinese government put a price freeze on certain products to help ease some of the pressure for China’s poor.

What could possibly slow down the Chinese economy?  How about interest rates. 

The People’s Bank of China raised interest rates again, four days after China announced that August’s inflation index rose to a 11-year high. Starting Sept. 15, the benchmark one-year lending rate will rise to 7.29%, from 7.02%. The one-year deposit rate will rise to 3.87%, from 3.60%.  The markets had expected the Chinese central bank to raise interest rates for a fifth time before the end of this year. China’s policymakers’ most recent rate hikes—coming three weeks since the last increase—coupled with other measures taken last week, have sent a strong signal to the financial markets that Beijing is willing to take more aggressive action to keep inflation under control.

5 rate hikes in one year? Wow.