Real Estate Investments for Overseas Buyers
For international buyers seeking real estate in the states, America is still the land of opportunity. Investors around the globe are flocking to the U.S. market to shop low prices, steady appreciation rates, and rock-solid security.
Recent studies reveal some very happy customers. According to the newest AFIRE survey, the U.S. provides the world’s “most stable and secure real estate investments,” rated over three times higher than the closest competitor.
This means foreign investors from all different countries, business interests, and economic strata have selected America as their top investment destination. Read on for a rundown of who’s buying, why they’re buying, and how new investors can buy, too.
Based on a recent figure released by the National Association of Realtors, foreign investments between March 2011 and March 2012 totaled a whopping $82.5 billion. This is a 24% increase from the previous year—a sure sign that international buyers are finding shelter in America’s recovering real estate market.
There are many reasons why U.S. real estate is more accessible, secure, and profitable than ever:
• The U.S. dollar is down, making exchange rates favorable
• Foreclosures have led to a dip in property prices; real estate is a buyer’s market
• The recent depression of regional property markets has been succeeded by a gradual and steady economic recovery
• Rental prices are high and rising
• Investors can choose from a wide selection of real estate inventory
• America has friendly property laws, and doesn’t throw red tape between foreign investors and their goals
In other words, U.S. real estate isn’t just for sale—it’s on sale. Foreign investors recognize this, and so do American immigrants. The National Association of Realtors reports that in 2009, 80% of immigrants to the U.S. were homeowners. Compare that to the domestic home ownership rate of 67%.
Who is buying…and why?
New numbers released on realtor.org reveal some interesting facts about international buyers. Foreign investors hail from over 70 nations. Canadians are America’s biggest customers—23% of all foreign sales of U.S. property can be attributed to our neighbors in the north. Next is China, which accounts for 9 percent of all foreign sales. Tying for third are Mexico, India and the U.K, with Argentina and Brazil in coming in fourth. Excluding Canada, the bulk of foreign real estate purchases originate from Asia and South America.
Buyers are either foreign citizens, recent immigrants, or hold non-permanent U.S. visas. The hottest states among investors are Arizona, California, Florida, and Texas, with Florida taking nearly 30% of all money spent on U.S. real estate in 2011.
Whether an investor is European, Asian, or South American, the choice of where to buy boils down to individual preference. Several factors can affect the decision-making process:
• Price of the property
• Prospect of long-term appreciation
• Proximity to jobs/financial hubs/offices
• Access to schools, universities, and other public institutions
• Type of property (single family home, condo, hotel, shopping center, warehouse, etc.)
• Location, climate, and nearness to the buyer’s home country
Where we fit in
The experts at NexGen Invest understand the importance of having a global perspective, and want to help foreign investors capitalize on the thriving U.S. real estate market. If you are an international buyer looking to invest, please contact our team for more information.