_Foreign investment in US homes hits record high
More than US$153 billion of US residential property was purchased by non-resident foreign buyers and recent immigrants between April 2016 and March 2017, up from US$102.6 billion a year earlier. In real terms, this equates to the purchase of 284,455 properties by foreign buyers over the 12-month period.
The report also revealed that nearly half of the foreign buyer purchases were located in three US states: Florida, California and Texas.
Given the strength of the US dollar and the rise in US house prices this growth in foreign demand may seem counter-intuitive. However, the US National Association of Realtors (NAR) argues that in the eyes of international buyers the US remains a safe and secure place to live, work and invest and this remains a key driver.
How much are foreigners spending?
The average price of a US property purchased by a foreign buyer in 2017 stood at US$302,290 with around 10% of foreign buyers purchasing a property priced above US$1m.
Who’s buying in the US?
This year’s report highlighted a shift in the origin of foreign buyers. Although China maintained its top position in sales dollar volume for the fourth consecutive year, the largest rise in activity was amongst Canadian buyers who accounted for US$19 billion in sales, up from US$8.9 billion in 2016.
Recent double-digit annual price rises in Canadian cities such as Vancouver and Toronto have provided some Canadians with greater equity for second home purchases whilst for others the relative affordability of the US has boosted its appeal.
Chinese and Canadian nationals were responsible for US$31.7 billion and US$19 billion respectively in US residential sales, followed by the UK (US$9.5 billion), Mexico (US$9.3 billion) and India (US$7.8 billion).
The US National Association of Realtors tracked transactions with international clients during the 12-month period between April 2016 and March 2017. A total of 5,998 realtors responded to the 2017 survey
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