Non-resident foreign buyers purchased $102.6 billion of residential property in the United States between April 2015 and March 2016. The median price of properties purchased by non-resident foreign buyers is of $253,684. Non-resident foreign buyers made up the bulk of buyers from Canada ($8.9 billion) and the U.K. ($5.5 billion) and Germany ($3.7 billion).
Although foreign investors purchased property nationwide, five states accounted for 51% of total residential property purchased by foreign buyers: Florida (22%), California (15%), Texas (10%), Arizona (4%) and New York (4%). A staggering 72% of non-resident foreign buyers, purchased their property as a vacation and/or residential property for investment purposes. 50% of reported transactions by foreign buyers were all-cash sales and 73% of non-resident foreign investors made all-cash purchases.
However the decline in value of the British pound after Brexit (almost 6% soon after the June 2016 referendum), is likely to mean fewer buyers from the United Kingdom for the remaining term of 2016 and most likely for 2017, due to the uncertainty of the British economy after the recent results. At the same time, some experts believe that Brexit might be an opportunity for the United States to attract those investors who are no longer confident in purchasing real estate in the United Kingdom or attract those who want to get out of the British real estate market, not knowing the impact that Brexit might cause to their real estate investments.
On average foreign buyers purchased properties that were more expensive than existing home sales for all buyers in the United States. Foreign buyers paid $477,462 which is significantly higher than the average price of $266,683 for a residential property in the United States in 2016. 10% of foreign buyers purchased properties valued at over $1 million. Foreign buyers from India purchased properties for $6.1 billion while British buyers purchased properties for $5.5 billion, buyers from Mexico accounted to $4.8 billion while Canadians and Chinese reach the top of the list with respectively $8.9 billion and $27.3 billion of residential real estate. Chinese and British tend to purchase more expensive residential properties than all other foreign buyers. Chinese buyers tend to invest in California while Canadians and Britons have invested more heavily in the states of Florida and Arizona.
For more information about the U. S. real estate market and the legal aspects of purchasing a residential property in the United States, you can contact our office via phone or e-mail and one of our experienced attorneys will be glad to answer to your questions.