In July, NAR Research released the 2022 Global Transactions in US Residential Real Estate, which provides information on REALTOR® transactions with international clients who have bought and sold US residential real estate. The report provides information on US buyers looking to buy property abroad. I spoke with my colleague Matt Christopherson, Senior Research Analyst, about the report’s key findings and takeaways.
What is the profile of international transactions in US residential real estate – what information will we find in this report?
Matt Christopherson: This report provides a profile of foreign buyers of US residential real estate over the past year. In the report, we look at where people are buying, the states and areas where they are buying, the properties purchased and more. We also consider REALTORS® experience working with domestic clients looking to purchase property abroad.
What are the main takeaways from the report?
Matt Christopherson: Last year, the number of foreign buyers decreased and the dollar amount of their purchases increased. This is due to US price gains and foreign buyers generally seeing higher priced homes than the typical domestic buyer. Buying just 98,600 homes (1.6% of US existing home sales), foreign buyers accounted for $59 billion in purchase dollars (2.6% of existing home sales). The country with the highest percentage of buyers in the US was Canada, and the state with the most foreign buyers was Florida. Foreign buyers mainly bought single-family homes, and about half of them paid cash.
What are some key differences between last year’s report and the new version?
Matt Christopherson: Some of the key differences and shifts were fewer foreign buyers than last year, but higher dollar volume purchases, which is explained by the increase in US home prices and generally foreign buyers looking at and buying high dollar homes. However, foreign buyers remain less than two percent of all home sales in the US.
What significant trend(s) stood out to you in the 2022 report?
Matt Christopherson: One major trend that is important in this area of real estate is the share of foreign buyers buying with all cash offers. This was an all-time high, and this past year, they bought nearly twice the amount of local buyers with all cash offers: 44 percent bought with all cash compared to 24 percent of domestic buyers. This keeps foreign buyers untouched by the rising mortgage rates we are seeing and makes their offers very competitive.
What aspects of this report are most interesting?
Matt Christopherson: I find it very interesting to see which states and which types of areas (suburbs vs. city centers, etc.) buyers from different countries buy from. For example, buyers from Canada, Brazil, and Colombia are more likely to shop in Florida, while buyers from China and India are more likely to shop in California. Additionally, among the top 6 countries, Brazilian buyers are more likely to shop in central city/urban areas, buyers from India are more likely to shop in suburban areas, and buyers from Colombia and Canada are more likely to shop than others. Shop in small towns.