Real Estate News | North America Residential News
International Home Buying Dips in US
By WPC Staff | June 25, 2013 5:10 PM ET
The volume of homes purchased by international buyers dropped 17.3 percent last year, as global economies wavered and shoppers focused on low-cost properties, according to the latest study by the National Association of Realtors.
For the 12 months ending in March, total sales to international clients was $68.2 billion, down from $82.5 billion the previous year.
NAR blamed several factors for the drop, including a weakening of the currency in Europe, Brazil, India and Mexico.
"Economic slowdowns in a number of major foreign economies appear to have been a major reason for a drop in sales," the report states. "In the case of resident foreigners... economic uncertainties in the U.S. economy may have slowed buying activity."
Although the volume was down, the total was the second highest in recent years, NAR said.
International buyers accounted for about 6.3 percent of the total U.S. existing homes sales in the period. About 51 percent of the purchases were made by people with permanent residences outside the United States; the rest by recent immigrants or visitors with temporary visas.
Florida attracted the largest group of international buyers, accounting for 23 percent of transactions, followed by California (17 percent), and Arizona and Texas, each with 9 percent of sales.
Canadians were the biggest purchasers of U.S. homes, accounting for 23 percent of the purchases in NAR's annual survey. China, which accounted for only 5 percent of international purchases in 2007, was next with 12 percent of the international sales, followed by Mexico (8 percent), India (5 percent) and United Kingdom (5 percent).
About 54 percent of international purchases were under $250,000, NAR reports. But Chinese buyers were active in the upper range, buying homes with the median price at $425,000, followed by India ($ 300,000), the United Kingdom ($ 250,000), Canada ($ 183,000) and Mexico ($ 156,250). About 63 percent of reported transactions were all cash.
About 42 percent of reported international buyers said they would use the homes as a primary residence, while 20 percent said they would use the property as a vacation home.
Approximately 27 percent of the realtors who responded to the survey said they had worked with international clients in the past year, unchanged from 2012, but down from the high of 32 percent in 2007.