Sales of U.S. homes to foreign buyers rose to an estimated $92.2 billion last year — the highest sales volume in at least four years, according to an annual report from the National Association of Realtors.
The rise was led by Chinese buyers, who accounted for $22 billion — or 24 percent — of that total, up from $12.8 billion in last year’s report.
Four states made up 55 percent of the total reported purchases by foreign buyers: Florida (23 percent of purchases), California (14 percent), Texas (12 percent) and Arizona (6 percent).
NAR’s 2014 Profile of International Home Buying Activity analyzed data gathered from 3,547 Realtor respondents on international client purchases of U.S. homes between April 2013 and March 2014. International clients were those who either had a permanent residence outside of the U.S. or were recent immigrants who had been in the U.S. less than two years.
“We live in an international marketplace; so while all real estate is local, that does not mean that all property buyers are,” said NAR President Steve Brown in a statement.
“Foreign buyers are being enticed to U.S. real estate because of what they recognize as attractive prices, economic stability, and an incredible opportunity for investment in their future.”
The report found that both sales volume and transaction sides in international sales increased in the 12 months ending in March. Sales volume rose to $92.2 billion, up 35 percent from $68.2 billion the year before. That’s about 7 percent of the total U.S. existing-home market of $1.2 trillion in that same time period.
International buyers typically purchased higher-priced homes, buying for a median $268,000 compared with a median $200,000 for U.S. existing homes as a whole.
Five countries accounted for 54 percent of international sales: Canada, China, Mexico, India and the United Kingdom. While Canadian buyers continued to be the top source of international sales by transaction volume, Chinese buyers accounted for the largest sales volume by far: $22 billion compared with Canadian buyers’ $13.8 billion.
This appears to be largely due to Chinese buyers’ preference for homes in higher-priced areas such as California, Washington and New York. The median sales price of a home purchased by a Chinese buyer was $523,148, compared with $212,500 for Canadian buyers. Nearly two-thirds of purchases by Canadian buyers were in Florida or Arizona.
China is the fastest-growing source of international clients and now accounts for the second-largest share of transactions, just behind Canada, according to the report.
Six in 10 international buyers paid in cash, likely due to difficulties in obtaining U.S. mortgage financing, the report said.
Among the respondents, 28 percent of Realtors reported working with international clients, but only 4 percent had 11 or more international transactions in a year, indicating that international sales tend to be handled by specialists, NAR said.