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Florida tops states where
foreigners purchase property
NATIONAL ASSOCIATION OF
REALTORS
Waning economic growth in many
countries and higher home prices further enhanced by a strengthening U.S.
dollar resulted in a slight decline in international sales dollar volume of
U.S. property over the past year and a significant retreat in buying from non-resident
foreigners.
This is according to an annual
survey of residential purchases from international buyers recently released by
the National Association of Realtors. The survey also revealed that the dollar volume of sales from
Chinese buyers exceeded the total dollar sales figure of the next top four
ranked countries combined.
NAR’s 2016 Profile of
International Activity in U.S. Residential Real
Estate found that foreign buyers purchased $102.6 billion
of residential property, a 1.3 percent decline from the $103.9 billion of
property purchased in last year’s survey. Overall, a total of 214,885 U.S.
residential properties were bought by foreign buyers (up 2.8 percent), and
properties were typically valued higher ($277,380) compared to the median price
of all U.S. existing home sales ($223,058).
Lawrence Yun, NAR chief economist, says this year’s findings highlight the
tremendous appeal U.S. real estate still has on many foreign nationals despite the price of
property becoming less affordable.
“Weaker economic growth
throughout the world, devalued foreign currencies and financial market
turbulence combined to present significant challenges for foreign buyers over
the past year,” Mr. Yun says. “While these obstacles led to a cool down in sales from
non-resident foreign buyers, the purchases by recent immigrant foreigners rose,
resulting in the overall sales dollar volume still being the second highest
since 2009.
“Foreigners — especially those
from China —
continue to see the U.S. as a solid investment opportunity and an attractive
place to visit and live.”
Five states account for half
of foreign buyer purchases. Slightly over half of all foreign buyers purchased
property in Florida (22 percent), California (15 percent), Texas (10 percent), Arizona or New York (each at 4 percent). Latin
Americans, Europeans and Canadians, who
tend to buy in warm climates for vacation purposes, mostly sought properties in
Florida and Arizona. California and New York drew the most Asian buyers, while
Texas mostly saw sales activity from Latin American, Caribbean and Asian
buyers.
The median purchase price over
the survey period was a tad lower ($277,380) compared to the 2015 survey
($284,900) as a result of the fewer non-resident foreign buyers. Overall,
foreign buyers most commonly purchased a home priced between $250,001 and
$500,000, while 10 percent paid over $1 million or more. Exactly half of all
international transactions were all-cash purchases, which was slightly down
from a year ago (55 percent) but still roughly double the overall share of
existing sales. All-cash purchases were more common by non-resident foreign
buyers (73 percent) and those from Canada, China and the United Kingdom.
A majority of foreign buyers
over the past year purchased a single-family home, and nearly half bought in a
suburban area. Two–thirds or more of buyers from each China, India, Mexico and the United Kingdom
purchased detached single-family homes, while Canadian buyers were the most
likely to buy a multi-family home.
The 2016 Profile of Home
Buying Activity in U.S. Residential Real Estate can be ordered by calling (800)
874- 6500 or by going to realtor.org online. The report is free to NAR members,
$149.95 for others. ¦
