According to the most recent report from the National Association of Realtors, during the twelve-month period from April 2013 until March 2014, foreign purchasers’ real estate activity increased 35%. In fact, international buyers accounted for $92.2 billion worth of real estate sales activity in the United States. It seems that good exchange rates, a growing middle class in many countries, and the affordable prices in the United States are allowing more individuals to invest here. Most of these purchases were for luxury homes in the states of California, Texas, Arizona, and of course, Florida. Buyers from China were the largest group of overseas investors, with their portion of sales activity increasing over 70% during that same twelve-month period. And, our Chinese friends spent the most on real estate, with their average property price coming in just under $600,000.
Most of the Chinese buyers purchased real estate in California and New York. This actually explains the average price that they are paying. However, we still aren’t seeing many such buyers in Florida! Apparently, European buyers find the warmer locales more appealing while Asian buyers are drawn to the West Coast. Some of this is probably simply due to proximity. A flight from London to Miami is quite a bit shorter than a flight from London to Los Angeles, just as a flight from Beijing to Los Angeles is much shorter than a flight from Beijing to Miami. Regardless, Florida is still considered the number one choice for a real estate investment for foreigners, accounting for 23% of the sales activity.
In addition to the surge in Chinese buyers, many overseas investors hail from Canada, Mexico, the United Kingdom, and India. Surprisingly, over half of the homes purchased were single-family residences located in suburban areas, and almost half of the buyers intend to utilize the property purchased as their primary residence. Even though we have seen our fair share of international investors cashing in (literally and figuratively) on the Miami real estate market, we’re hoping to see a bit more diversity in the purchasing pool in the near future, particularly from the side of the world that we probably consider west of us but is regarded as the east. If you’re confused, we mean Asia. The U.S. serves as proof that having diverse constituents can lead to great things.