Foreign buyers of United States homes surges to new record high

Share

Real estate agents in Southern California have reported a slowdown in Chinese buyers, which runs counter to the survey results.

Canadians spent $19bn, more than double the previous year, much of it in the sunny southern state of Florida, the National Association of Realtors said.

Foreigners living in the U.S. and overseas - including recent immigrants, people on visas and investors living overseas - accounted for roughly 284,455 homes sold in that time, up 32% from the prior year, the report said.

"Stricter foreign government regulations and the current uncertainty on policy surrounding USA immigration and worldwide trade policy could very well lead to a slowdown in foreign investment", said Lawrence Yun, chief economist for the NAR.

And despite a relatively strong dollar, foreigners are willing to pay a bit more to invest in the United States, he said. Overall, 284,455 US properties were bought by foreign buyers (up 32 percent from 2016), and purchases accounted for 10 percent of the dollar volume of existing-home sales (8 percent in 2016).

Canada's house prices were also rising, but the pace of growth and sales have recently slowed as policymakers tightened access to credit on concern that some markets like Vancouver are in a bubble.

More news: Indian presidential election: Counting of votes begins, results to be out today

Foreign buyers in California purchased $35 billion worth of properties, up from $27 billion a year earlier. After dipping in the 2016 survey to $8.9 billion in sales ($11.2 billion in 2015), transactions from Canadians this year totaled $19.0 billion - a new high for Canada.

Buyers include those seeking vacation and investment properties, as well as temporary workers who are in the USA for more than six months for professional or educational reasons, the association said. While much of the USA continues to see fast price growth, home price gains in many cities in Canada have been steeper, especially in Vancouver and Toronto.

In terms of the number of homes, the same five countries are estimated to top the list. Chinese buyers also purchased the most housing units for the third consecutive year (40,572; up from 29,195 in 2016). The boost came as activity from Canada exploded to $19 billion, with buyers from China, India, Mexico and the United Kingdom also contributing considerable volume.

"You could easily make the point that perhaps their uptick was wanting to buy now before new immigration policy was in place", said Adam DeSanctis, economic issues media manager at the National Association of Realtors.

Foreign sales rise in top five countries; three states account for almost half of all purchases.

While Florida was the most popular state for Canadian buyers, California was the favorite among Chinese and Mexicans preferred to purchase property in Texas.

Share