Tuesday, July 18, 2017
The foreign US residential housing market is still growing with a 49% jump compared to last year. United States is seen as a safe haven place to live, work and invest. 44% of all foreign transactions were all-cash as well further driving up the housing prices due to lack of continued inventory. Even with the strong dollar foreigners are willing to pay a bit more to invest in the US.
A tumultuous political environment isn’t scaring international buyers from investing in US residential real estate.
Foreign investment in US residential real estate hit a new high this year, driven by an increase in sales dollar volume from Canadian buyers, according to a new survey by The National Association of Realtors.
Foreign buyers and recent immigrants bought $153 billion of residential property, which represents a 49% jump from last year.
“The political and economic uncertainty both here and abroad did not deter foreigners from exponentially ramping up their purchases of U.S. property over the past year,” said Lawrence Yun, NAR chief economist.
And despite a relatively strong dollar, foreigners are willing to pay a bit more to invest in the US, he said.
“While the strengthening of the U.S. dollar in relation to other currencies and steadfast home-price growth made buying a home more expensive in many areas, foreigners increasingly acted on their beliefs that the U.S. is a safe and secure place to live, work and invest.”
Foreign investors paid, on average, $302,290, a 9% increase from the median sales price last year. Ten percent of international buyers paid over $1 million, with 44% of transactions all-cash purchases.
The survey reveals that China is still No. 1 in terms of sales dollar volume, but the overall boost in activity came from Canadian buyers.
Transactions from Canadians this year more than doubled from last year, reaching $19 billion – a new high for Canada.
Canadians are finding that US markets though expensive are actually more affordable than in their home country. Though home prices have been steadily rising, gains across Canada have been steeper, especially in Vancouver and Toronto, according to Yun.
Chinese investors purchased $31.7 billion this year, up from $27.3 billion last year and $28.6 in 2015. Buyers from China also bought the most residential units for the third consecutive year.
The top five countries in terms of sales dollar volume after China are Canada, the UK, Mexico and India — all saw increases from last year’s levels.
Mirroring the 2016 survey, investors focused on three states — Florida (22%), California (12%) and Texas (12%). New Jersey and Arizona round out the top five destinations for foreign buyers.
While Florida was the most popular state for Canadian buyers, California was the favorite among Chinese and Mexicans preferred to purchase property in Texas.
Though this survey reveals that foreigners are buying at robust levels, headwinds like the shortage of homes for sale could end up denting sales activity, according to Yun.
“Stricter foreign government regulations and the current uncertainty on policy surrounding U.S. immigration and international trade policy could very well lead to a slowdown in foreign investment,” he said.
Thursday, July 13, 2017
Yep, it's true! There are still so many all cash offers in LA. I'm seeing it firsthand so far this year representing so many clients up against multiple offers on so many properties. The competition has been fierce in my personal experience. Parents or rich uncles and family buying for their children to give them a head start in life. I feel this is one of the richest generations with the aging baby boomers. I'm seeing the starter homes in affluent homes being much nicer than in the past with modern amenities and location being the key factor. This generation of folks desire proximity to everyday conveniences and want to be close to the city center of local restaurants.
Let me know if you have a home to sell as there is huge shortage of homes. It's still a seller's market and I have clients ready to buy. If you're looking to buy I'll help you be prepared to face the competition. Finding out what is important to the seller is important as sometimes it's not necessary just the price. Multiple offers... bring it on with me you will have a real chance. Feel free to contact me for a real estate consultation. Love to help you with your real estate needs. Call me Sandy Lew at 310-963-1623. My website:www.sandralew.com
Who’s making all-cash offers on houses in LA?
Last month, cash purchases made up 20 percent of all real estate transactions
by Bianca Barragan
As sales prices for Los Angeles homes continue their solid recovery from the recession, the profile of all-cash homebuyers has changed.
In the wake of the recession, foreign and domestic investors made up a good chunk of cash-only buyers in LA. All-cash sales are still happening fairly frequently—last month, 20 percent of all real estate transactions in Southern California were all-cash, Geoff McIntosh, president of the California Association of Realtors, tells KPCC—but the days of investors snapping up homes passed four or five years ago, says McIntosh.
Who are these buyers making all-cash home purchases? KPCC reports that one dominant group is the children of wealthy parents. "They're going to mom and dad and saying, 'We really want to buy something and would love it if you give us the money,'" McIntosh tells the radio news station.
Another is tech industry employees, Richard Green, director of the USC Lusk Center for Real Estate, tells KPCC. He says these workers are often paid well and are offered stock options that they can sell when the company goes public, leaving them with money to put toward a house.