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Fremont’s East Indian Community in Flux As Silicon Valley’s Economy Turns

3 November 2008 One Comment

By Karen Weise

As the economic downturn moved through Silicon Valley, Fremont’s East Indian community struggled with the possibility of returning to India.

Job cuts started hitting Silicon Valley in September, with layoffs from large mainstays like Yahoo and startups like YouSendit emailing services, according to TechCrunch’s Layoff Tracker.

While Indian engineers arrived in Silicon Valley as early as the 1970s, during the early 1990s a large number started settling in Fremont, according to Shalini Shankar, assistant professor at Northwestern University, in her new book, “Desi Land.”

Mission San Jose Median Sales Prices

Mission San Jose Median Sales Prices

Real estate Agents Timothy Crofton and Bill McCord said their Indian clients typically wanted to live in Mission San Jose, because of the top-rated schools, but also looked at homes in Glemoor and Weibel, where home prices were lower.

Now, Fremont-based Crofton estimated that 20 percent of his clients were selling to move back to Asia.

As the domestic economy tumbled and India’s own IT sector grew, Crofton said he has seen a reverse migration of clients returning to India, where they saw greater opportunities.

Monica Kumar, executive director of Indian Business and Professional Women and a senior product marketing manager at Oracle, said she has seen this trend amongst Silicon Valley’s Indian community for the past two or three years. While she hasn’t seen an immediate spike in emigration as a result of the recent downturn, she hypothesized that in the next few months more families might pick up and move.

Though the current downturn was unsettling, those who returned to India were hopeful that in the long term, India might benefit, Kumar said. In particular, she said Indians were optimistic that when the economy rebounds and companies start expanding, companies will backfill old U.S.-based jobs with new, lower-paid workers in India.

Crafton, who said his clients are 95 percent engineers primarily from India and East Asia, said this reverse migration worried him. “Our home values are buoyed by the fact that we have technology professionals that have the income,” he said. “That is what supports Fremont.”

For those who stay, the current economic environment created confusion and anxiety. Crofton, said that his business had a two week period in early October when clients were “deer stuck in a headlight.” He said everyone panicked and completely stopped buying.

Mission San Jose Number of Sales

Mission San Jose Number of Sales

Kumar said she had a few friends who started remodeling their houses a few weeks before the recent collapse. “It is a bit scary,” she said. “You are investing all this money in your home, and no knowing if it is a good idea to invest this money.”

Bill McCord, owner of Realty World Windsor & Associates that specializes in the Silicon Valley clientele, said Indian tech workers are usually well qualified to meet mortgage requirements. “The typical buyer from those communities will have excellent credit, stable employment, is better able than the regular communities to buy should they wish,” he said.

In Mission San Jose, for example, the number of third-quarter home sales decreased only 1.5 percent, whereas Fremont overall decreased 24 percent, according to the real estate website Trulia.

Still, McCord said while realtors and clients swarmed his open houses in the past two weeks, no one made an offer. “They are still in the wings,” he said.

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