FOR IMMEDIATE RELEASE: MONDAY, SEPT. 19, 2022
STATEN ISLAND, N.Y. – Whether you reside on Staten Island or elsewhere in the United States, a global report released earlier this year by the National Association of REALTORS® (NAR) may spark your interest to learn more about foreign real estate opportunities.
On the radar of Staten Island Board of Realtors® (SIBOR) members who are mindful of global enterprise, NAR’s “2022 Profile of International Transactions in U.S. Residential Real Estate” offers information regarding REALTOR® transactions with international clients who purchased and sold U.S. residential property during the 12-month period of April 2021-March 2022 – and further provides some insight for Americans pondering overseas real estate purchases.
The report is based on an online survey that was conducted from April 11 to May 9, 2022. The survey was sent to 150,000 randomly selected REALTORS® and to members of local associations that also conducted surveys of foreign buyers. A total of 9,397 REALTORS® responded to the national and local market surveys, of which 1,101 reported an international residential foreign buyer.
CLIENTS SEARCHING FOR PROPERTY ABROAD
As described in the NAR report released in July: “International real estate is multi-faceted. Not only do international clients choose to purchase U.S. real estate, but U.S. clients (whether U.S. citizens or non-U.S. citizens) are also interested in purchasing property abroad.
“Nine percent of respondents reported they had a client who was seeking to purchase property in another country. Most U.S. clients (whether foreigners or not) were interested in a property to rent out or to use as a vacation home, accounting for 65% of clients.
“Mexico has been a favorite country among clients seeking to purchase property abroad. Other Latin American countries of interest are Costa Rica, Colombia, and the Dominican Republic. China is the top destination among Asian countries of interest. Spain, Canada, Portugal, Germany, and France are also top countries of interest to U.S. clients seeking to purchase property abroad.”
The report shows that foreign buyers purchased $59 billion worth of U.S. existing homes from April 2021 through March 2022, an 8.5 percent increase from the previous 12-month period and stopping a three-year skid in foreign investment in U.S. residential real estate. Foreign buyers purchased 98,600 properties, down 7.9 percent from the prior year and the fewest number of homes bought since 2009, when NAR began tracking this data.
Overall in the U.S., existing-home sales totaled 6.12 million in 2021 – the highest annual level since 2006.
“For the second year in a row, restrictions and general caution tied to international travel during the pandemic slowed home buying by wealthier foreign buyers,” said NAR Chief Economist Lawrence Yun. “Even so, domestic home buying demand was exceptional and, therefore, boosted home sales nationally.”
The NAR report surveyed members about foreign buyers who resided in the U.S. as recent immigrants or who were holding visas that allowed them to live in the U.S. purchased $34.1 billion worth of U.S. existing homes, a 5.2 percent increase from the prior year and representing 58 percent of the dollar volume of purchases. Foreign buyers who lived abroad purchased $24.9 billion worth of existing homes, up 13.2 percent from the 12 months prior and accounting for 42 percent of the dollar volume. International buyers accounted for 2.6 percent of the $2.3 trillion in existing-home sales during that time period.
The average ($598,200) and median ($366,100) existing-home sales prices among international buyers were the highest ever recorded by NAR – and 17.7 percent and 4.1 percent higher, respectively, than the previous year. The increase in foreign buyer prices partly reflects the increase in U.S. home prices, as the monthly average existing-home sales price rose to $374,300, up 10 percent from the prior period. At just over $1 million, Chinese buyers had the highest average purchase price, and nearly a third – 31 percent – purchased property in California.
“Affordability challenges along with the inability to find the right property were the top reasons given for prospective international buyers who showed interest but ultimately did not purchase a home in the United States,” said Yun.
China and Canada remained first and second in U.S. residential sales dollar volume at $6.1 billion and $5.5 billion, respectively, continuing a trend going back to 2013. India ($3.6 billion), Mexico ($2.9 billion), and Brazil ($1.6 billion) rounded out the top five.
For the 14th straight year, Florida remained the top destination for foreign buyers, accounting for 24 percent of all international purchases. California ranked second (11 percent), followed by Texas (8 percent), Arizona (7 percent), and New York and North Carolina, tied at 4 percent.
All-cash sales accounted for 44 percent of international buyer transactions, nearly twice the rate (24 percent) of all existing-home buyers. Non-resident foreign buyers (60 percent) were twice as likely to make an all-cash purchase compared to resident foreign buyers (30 percent). Nearly 7 out of 10 Canadian buyers (69 percent) made all-cash purchases, the highest share among foreign buyers. Asian Indian buyers were the least likely to pay all-cash, at just 9 percent. Almost 6 out of 10 Chinese buyers (58 percent) and a quarter of Mexican (27 percent) and Brazilian buyers (26 percent) made all-cash purchases.
“Due to rising interest rates, overall home sales will decline in the U.S. this year. Foreign buyers, however, are likely to step up purchases, as those making all-cash offers will be immune from changes in interest rates,” Yun added. “In addition, international flights have increased in recent months with the lifting of pandemic-related travel restrictions.”
Forty-four percent of foreign buyers purchased their property for use as a vacation home, rental property or both. Approximately two-thirds of international buyers (64 percent) purchased detached single-family homes and townhouses. Nearly half of international buyers (46 percent) purchased a home in the suburbs while 29 percent bought a home in an urban area – both figures have held steady over the last five years. Five percent of foreign buyers bought property in a resort area, down from 17 percent in 2012.
“Driving economic development through our work to foster diverse and inclusive communities remains a top priority for NAR,” said Katie Johnson, NAR’s general counsel and chief member experience officer. “Our association collaborates with groups across the country to help our members unlock and better understand the opportunities in U.S. real estate for foreign buyers, maximizing the global business potential in our local markets. NAR and the REALTOR® brand has grown to an international network of more than 100 real estate associations across 76 countries, ensuring stable, accessible markets that allow our members to make direct connections with global real estate professionals and sources of foreign investment.”
View the full 2022 Profile of International Transactions in U.S. Residential Real Estate here: https://www.nar.realtor/research-and-statistics/research-reports/profile-of-international-activity-in-u-s-residential-real-estate.
The National Association of REALTORS® is America’s largest trade association, representing more than 1.5 million members involved in all aspects of the residential and commercial real estate industries.
About the Staten Island Board of Realtors® (SIBOR)
Established in 1915, the Staten Island Board of Realtors® (SIBOR) is the largest professional association in Staten Island, N.Y.
SIBOR exists to enhance the ability and opportunity of its members to conduct their business successfully and ethically, and promote the preservation of the public’s right to own, transfer and use real property.
Comprised of approximately 2,500 members, SIBOR serves real estate agents, brokers and affiliated professionals throughout the borough and surrounding areas.
SIBOR is the provider of the Staten Island Multiple Listing Service Inc. (SIMLS), which works as a clearinghouse through which more than 275 local real estate firms exchange information on properties they have listed for sale. Together, its members participate in over 5,000 real estate transactions every year.
All SIBOR Realtors belong to the New York State Association of REALTORS® (NYSAR) and the National Association of REALTORS® (NAR).
SIBOR may be reached at 718-928-3220 and viewed online at SIBORREALTORS.com. SIBOR may also be visited on Facebook at Staten Island Board of Realtors,Twitter via @SIBOR and Instagram at SIBOR REALTORS (siborrealtors).