Sales of U.S. Homes to Foregin Buyers Decline 17 PercentJohn Gittelsohn
U.S. home purchases by international buyers fell 17 percent, to an estimated $68.2 billion, as economic growth slowed in Europe and Asia, the National Association of Realtors said.
Sales of homes to overseas buyers totaled an estimated $34.8 billion, while sales to long-term U.S. residents who aren’t citizens were about $33.4 billion in the 12 months through March, according to a report released today. All U.S. home sales totaled $1.08 trillion during the period.
“Economic slowdowns in a number of major foreign economies appear to have been a major reason for a drop in sales,” the Realtors said. Sales to foreign buyers totaled $82.5 billion in the previous 12-month period, according to the report.
The decline in international sales came as the U.S. housing market recovers from its worst crash since the Great Depression and has begun contributing again to economic growth. Gross domestic product in the euro region, meanwhile, decreased 1.1 percent in the first quarter from a year earlier, and probably will fall 0.6 percent for all of 2013, according to the median of 50 economist estimates compiled by Bloomberg.
U.S. existing homes sold at an annual pace of 5.18 million in May, their fastest since November 2009, when temporary tax incentives spurred growth, the Realtors association said last week. Prices jumped 15.4 percent from a year earlier to a median $208,000.
In the year through March, Canadians accounted for 23 percent of international purchases, followed by buyers from China at 12 percent, Mexico at 8 percent and India and the U.K. at 5 percent each, according to today’s report.
The value of sales declined, in part, because of more transactions at the lower end of the market by foreign buyers, the Realtors said. About 54 percent of reported international purchases were under $250,000.
Chinese paid the highest median price at $425,000, compared with $300,000 for buyers from India, $250,000 for Britons, $183,000 for Canadians and $156,250 for Mexicans.
Homes in Florida, California, Texas and Arizona accounted for 58 percent of purchases by foreigners. About half of international buyers prefer to buy in the suburbs, and 64 percent of acquisitions were single-family residences, the group said. The report was based on the responses of 3,357 Realtors surveyed from April 9 to May 10.