International buyers in the 12 months ending March 2013 made up an estimated 6.3 percent of all existing homes sales, according to a report issued by the National Association of Realtors® (NAR). This is the seventh survey completed by NAR since 2007.
NAR dichotomizes foreign buyers into two strata:
Type A – Those with permanent residences elsewhere that purchase a U.S. dwelling for vacation, investments or visits to the U.S. for less than six months annually
Type B – Immigrants in the U.S. less than two years or those holding temporary visas for more than six months in the U.S.
In the 12 month period examined, Type A foreign buyers purchased an estimated $34.76 billion of dwellings, Type B bought $33.42 billion, with the total market including domestic buyers an estimated $1,080.25 billion. The $68.2 billion, while representing 6.3 percent of the total market, was down from $82.5 billion from 2012 but up versus the $66.4 billion in 2011. The 2013 decline was attributed more to purchases of lower priced-transactions rather than reduced demand.
Primary Motives of Foreign Buyers
- 39 Percent – U.S. Desirable Location
- 31 Percent – U.S. Real Estate Viewed as Profitable Investment
- 22 Percent – Secure Investment
- Other
Reasons Foreigners Did Not Purchase
- 36 Percent – Ongoing Costs, Taxes and Insurance
- 29 Percent – Could Not Find a Property to Buy
- 26 Percent – Financing Issues
- 9 Percent — Immigration Laws
Source of Foreign Buyers (3 Percent and Up)
- 23 Percent – Canada
- 12 Percent – China
- 8 Percent – Mexico
- 5 Percent — India
- 5 Percent – United Kingdom
- 3 Percent – Argentina
Type of Property Purchased
- 64 Percent – Detached Single-Family
- 21 Percent – Condominiums – Apartments
- 9 Percent – Townhouse – Row House
- 6 Percent – Other
Intended Use of Property
- 42 Percent – Primary Dwelling
- 21 Percent – Vacation Home for Family and Friends
- 17 Percent – Residential Rental Property for Investment
- 4 Percent – Commercial Rental Property for Investment
Number of Months Intended Use
- 41 Percent – More than 6 Months
- 20 Percent – 3 to 6 Months
- 19 Percent – Do not know
- 11 Percent – Less Than 1 Month
- 9 Percent – 1 to 2 Months
Median Purchase Price by Country
Where They Bought
- 9 Percent – Arizona
- 17 Percent – California
- 23 Percent – Florida
- 9 Percent – Texas
To read all related information (and there is a bunch) and download the NAR report, click: http://www.realtor.org/topics/profile-of-international-home-buying-activity
Without question it is a global economy. Real estate included.
Ted