Foreign buyers purchased $US92.2 billion worth of real estate in the period from April 2013 to March 2014, according to a new report from the National Association of Realtors.
This is up 35% from $US68.2 billion for the previous period. And both the volume of sales and prices were up in this period.
International buyers typically buy higher-priced homes according to the report, with the mean purchase price of international clients doing to $US396 million. This was up from $US354 million in 2013, but down from $US405 million in 2012.
“International buying activity apparently was bolstered by continued rising affluence in China, Canada, India, Mexico, and the United Kingdom, according to the report. “In addition, the appreciation of the Chinese yuan and the British pound also made the purchase of U.S. property increasingly affordable for residents of those countries.”
The Chinese and Canadians were the biggest players
Those five countries accounted for 54% of real estate purchases. Canada was the biggest buyer in terms of transaction volume, but China was the biggest buyer in terms of dollar volume.
Sales from Chinese buyers climbed to $US22 billion, accounting for a 24% share, up from $US12.8 billion (19% share) the previous period. Meanwhile, sales from Canadians accounted for $US13.8 billion of 15% share, compared with $US11.8 billion (17% share) a year ago.
Chinese buyers also bought properties in more expensive markets like New York, California, and Washington, while Canadians bought homes in lower-priced markets like Florida and Arizona.
For the U.S. which is just starting to see housing supply expand this is a double-edged sword. The report finds that most purchases by foreign buyers tend to be cash purchases, and this can be an obstacle for traditional first time homebuyers. But increased demand could help boost prices and push more homebuilding and prompt more homeowners to list their properties.
Here’s a look at which states were most attractive to foreign buyers:
Here’s a look at foreign purchases by country of origin and how the trend has changed since 2010: