Foreign buyers scooping up U.S. homes

Discussion in 'Media' started by hvactec, Oct 24, 2011.

  1. hvactec

    hvactec VIP Member

    Jan 17, 2010
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    New Jersey
    Hey, wealthy foreigners! Want to live in the U.S.? Buy a home here.

    International purchases of American homes are ramping up, and a new Senate bill designed to boost the ailing real-estate market would encourage globe-trotting investors to buy even more.

    The bill, co-sponsored by Charles Schumer (D-N.Y.) and Mike Lee (R.-Utah) would grant a U.S. visa to international investors who agree to spend at least $500,000 on residential real estate here.

    If passed, the legislation could add to a surge in homebuying by international purchasers over the past year or two that's already given some local U.S. markets a welcome boost.
    Growing international interest

    Foreigners spent $82 billion buying up U.S. homes in the 12 months ended in March, up 24% from a year earlier, according to the National Association of Realtors (NAR). That represents 8% of total U.S. sales

    In places like South Florida, international buyers already account for a whopping 25% of the market. California, Texas and Arizona also attract many foreign buyers, as do Hawaii and New York.

    South Florida condo sales have been surprisingly strong, said Brad Hunter, chief economist for Metrostudy, a housing analytics company. "And the majority of those sales are to South Americans and Canadians," he said.
    Your local forecast

    All that international buyer activity has been a tonic for the anemic Florida market. Housing starts were up nearly 20% in the three months ended Sept. 30, according to Metrostudy.

    In Manhattan, there's been a steady baseline of foreign condo buyers, said Jonathan Miller, CEO of Miller Samuel, a New York appraisal firm. They generally account for about 15% of investors, but in recent years, the buyer mix in New York City has shifted, he said.

    When the euro was strong in the mid-2000s, buyers from Western Europe -- and particularly Ireland -- dominated.

    The Irish "economy was so strong back home -- the 'Celtic Tiger' years -- that many were flush and wanted to invest and take advantage of the spread between currencies," said Miller. "There were marketing groups that would go to Ireland and sell packages of condos here."

    Now, said Miller, the New York market now attracts more Asian and Latin American buyers than in the past.

    Wei Min Tan, a real-estate agent with Charles Rutenburg Realty who specializes in selling Manhattan real estate to Asians, said his volume has more than doubled this year.

    "I tell [buyers] it's going to be a stable investment that should go up 10% a year," he said. That's "not as much as they might get in Hong Kong or Shanghai," but there's less volatility, he said.

    Even better for homeowners, foreign sales can be very easy: The buyers are often affluent and buy more expensive homes. The median sale price of $175,000 they pay in Florida, for example, is well above the median sales price of $136,500 for all transactions.

    There's also no hassle over financing or waiting around for a mortgage lender to approve the deal: Overwhelmingly, international buyers pay cash.

    read more Foreigners are buying U.S. homes - Oct. 21, 2011

    WASHINGTON - Two U.S. senators unveiled a bill Thursday that aims to attract Canadian and Chinese tourists and encourage some foreign nationals to buy homes - and pay taxes - on U.S. soil.
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    Last edited: Oct 24, 2011

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