Offshore home buyers bought an estimated $92.2 billion of real estate in the U.S. from April 2013 through March 2014 or 1 24% increase from the previous period's level of $68.2 billion, data from the National Association of Realtors 2014 Profile of International Home Buying Activity showed.
"We live in an international marketplace; so while all real estate is local, that does not mean that all property buyers are," said NAR President Steve Brown, co-owner of Irongate, Inc. Realtors in Dayton, Ohio. "Foreign buyers are being enticed to U.S. Real Estate because of what they recognize as attractive prices, economic stability, and an incredible opportunity for investment in their future."
Brown said the favorable exchange rates, affordable home prices and rising affluence abroad are driving international buyers to the U.S. to purchase properties and make real estate investments.
International buyers and recent immigrants purchased homes throughout the country, but four states accounted for 55 percent of the total reported purchases - Florida, California, Arizona, and Texas. Florida remains the destination of choice, claiming a 23 percent share of all foreign purchases. California comes in second with 14 percent, Texas with 12 percent and Arizona with 6 percent. According to realtor.com, the top five cities searched online by international buyers in 2014 were Los Angeles, Miami, Las Vegas, Orlando and New York City.
Foreign buyers take many factors into consideration when deciding where to purchase abroad, such as proximity to their home country, the presence of relatives and friends, job and educational opportunities, and climate and location. European buyers are generally attracted to states with warmer climates such as Florida and Arizona while the West Coast tends to attract Asian purchasers.
Indian buyers tend to gravitate towards states that are home to large information technology companies, such as California, New York and North Carolina. Within markets in an individual state, it is not unusual to find concentrations of people grouped by nationality, possibly indicating that word-of-mouth and shared experiences influence purchases.
Twenty-eight percent of Realtors reported working with international clients this year. International sales tend to be handled by specialists and only 4 percent of those who reported having an international client saw 11 or more international transactions in a year. Of those who reported having an international client, approximately 54 percent reported that international transactions accounted for 1 to 10 percent of their total transactions, a decrease from 2013 but still in line with past years' levels.
International buyers who are looking for property or offshore investors who want to make real estate investment in the U.S. but has no time to make on-site visits of the properties they are eyeing can take opt to take online virtual tours instead.