Highlights from the Profile of International Activity in U.S. Residential Real Estate by the National Association of Realtors.
From NAR: Rising home prices and low inventory led to a decline in foreign home purchases in the United States. Total international sales totaled $121 billion during April 2017 to March 2018, a 21 percent decline from the previous 12-month period, according to an annual survey from the National Association of Realtors®.
NAR’s 2018 Profile of International Transactions in U.S. Residential Real Estate, found that foreign buyers and recent immigrants accounted for 8 percent of the $1.6 trillion existing home sales, a decrease from 10 percent during the 12-month period that ended March 2017.
“After a surge in 2017, we saw a decrease in foreign activity in the housing market in the latest year, bringing us closer to the levels seen in 2016,” said Lawrence Yun, NAR chief economist. “Inventory shortages continue to drive up prices and sustained job creation and historically low interest rates mean that foreign buyers are now competing with domestic residents for the same, limited supply of homes.”
This annual report focuses on two groups of international buyers and sellers of residential real estate:
– Non-resident foreigners: Non-U.S. citizens with permanent residences outside the United States. These clients typically purchase property for investment, vacation,or visits of less than six months to the United States on non-immigrant visas.
– Resident foreigners: Non-U.S. citizens who are recent immigrants (less than two years at the time of the transaction) or non-immigrant visa holders who reside for more than six months in the United States for professional,educational, or other reasons.
Residential Properties Purchased by Foreign Buyers
– Foreign buyers purchased 266,800 residential properties, a decrease from 284,000 during the previous 12-month period.
– The average price of properties purchased by the mix of foreign buyers was $454,400, a decrease from $536,900 during the previous period.
– All dollar volume of purchases from the top five countries declined compared to the levels in the previous 12-month period. The major foreign buyers were China, Canada, the United Kingdom, India, and Mexico.
– 72% of non-resident foreign buyers made an all-cash purchase; 30% of resident foreign buyers paid all-cash.
– 52% of foreign buyers purchased the property as a primary residence.
Residential Properties Sold by Foreigners
– 48% of international clients who sold their U.S. residential property originated from Canada, China, Mexico, India, and the United Kingdom.
– 61% of the properties sold by international clients were in Florida, California, Texas, Arizona, and New York
REALTOR® Interaction with International Clients
– 23% of REALTOR® respondents reported working with international clients, a decrease from 29% in the previous 12-month period.
– 33% of REALTOR® respondents reported an increase in the percentage of international client transactions to their business from one year ago, while 43% reported an increase from five years ago. Most respondents report no change in the share of their business that is international.
– 62% reported that personal contacts, previous clients, and business contacts were the major sources of clients/referrals.
– REALTORS® also help international clients lease U.S. properties. Among all respondents, 11% reported they helped a client lease a residential property.
About Jaleesa Peluso, Laguna Beach Realtor & Certified International Property Specialist
Jaleesa and her team specialize in representing local as well as foreign buyers and sellers of Orange County real estate. Are you considering leasing, buying or selling your Orange County home? Call us now at (949)395-0960!