The National Association of Realtors came out this week with their annual survey of International Buyers and the results are not surprising to anyone impacted by the Bay Area real estate market.
Covering the period from April 2014 to March 2015, Chinese were far and away the top foreign buyers, with buyers from China, Hong Kong and Taiwan accounting for $28.6 billion in sales, according to the report. Believe it or not, Canada was second with $11.2 Billion. These are national figures.
What we’re seeing in the Bay Area is a burgeoning Chinese middle and upper-middle class now looking to invest their money in a safe haven, away from China’s polluted air and political and economic uncertainties. Additionally, in China you never have home ownership, only long-term leases. Many deals are all cash. They can close in seven days, there’s no loan contingency, no inspection and no appraisal.
The Bay Area is attractive because it is arguably the most important business and technology hub in the U.S. Most buyers favored the suburbs over the city and most favored single-family detached homes over townhouses. We have great communities surrounding San Francisco and San Jose with fantastic amenities and high school scores that are right in the wheelhouse of what they are looking for. Click here to see the complete report: 2015 Profile of International Home Buying Activity
Highlights from the report:
- Approximately 209 thousand houses are estimated to have been sold to foreign buyers over the time period, approximately 4 percent of total Existing Home Sales.
- The total foreign sales dollar volume is estimated at $104 billion, approximately 8 percent of total Existing Home Sales dollar volume.
- Foreign clients paid on average nearly $500 thousand for a house, compared to the overall U.S. average house price of about $256 thousand.
- Sales to foreigners are split between resident and non-resident purchasers. Resident foreigners may be in the U.S. for business, educational, or other purposes. Non-resident foreigners are typically looking for a vacation or investment property.
- Five countries accounted for 51 percent of purchases by foreigners: Canada, China, Mexico, India, and the United Kingdom.
- Although foreigners purchased property nationwide, four states accounted for 50 percent of international sales: California, Florida, Texas, and Arizona.
- The percentage of REALTOR® respondents who reported working with international clients in the 12 months ending March 2015 increased by 7 percent over the previous year.
- Most buyers—some 55 percent of overseas buyers—paid all-cash, according to the report.
If you have any questions, please reach out to me. I’m available anytime at firstname.lastname@example.org or direct at (925) 487-2353.