U.S. real estate markets are now attracting foreigners in droves. Nearly $92 billion worth of American homes were bought by foreigners during the year ending March 2014, according to a National Association of Realtors survey - an increase of 35% on the previous year. Nearly 7% of all homes on the market are being bought by foreigners.
Favourable exchange rates and affordable home prices are the top reasons, the survey concluded.
Florida remains the top choice, with 23% of all international home sales. California, Arizona and Texas represented 14%, 12% and 6% respectively. The top five cities searched online by international buyers in 2014 were Los Angeles; Miami; Las Vegas; Orlando, Fla.; and New York City.
"We live in an international marketplace; so while all real estate is local, that does not mean that all property buyers are," says Steve Brown, president of NAR, in a statement. "Foreign buyers are being enticed to U.S. real estate because of what they recognize as attractive prices, economic stability, and an incredible opportunity for investment in their future."
Chinese buyers led the way by spending $22 billion on American real estate, followed by buyers from Canada with $13.8 billion. Buyers from United Kingdom and India spend $5.8 billion each. California was the favourite destination for Chinese buyers.
Foreign buyers have some unique characteristics:
- Nearly 60% of international transactions were all cash in 2014, compared to only one-third of domestic purchases.
- Only 42% of international buyers will use their U.S. home as their primary residence.
- Chinese buyers in the U.S. spend an average of $590,826 to buy a home.