In July, NAR Research released the 2022 International Transactions in U.S. Residential Real Estate report, which presents information regarding REALTOR® transactions with international clients who purchased and sold U.S. residential property. The report also provides information on U.S. clients seeking to purchase property abroad. I spoke with my colleague Matt Christopherson, Senior Research Analyst, about the report's essential findings and main takeaways.
What is the Profile of International Transactions in U.S. Residential Real Estate – what kind of data can we find in this report?
Matt Christopherson: This report provides a profile of foreign purchasers of U.S. residential real estate over the past year. In the report, we look at where folks are purchasing from, the states and areas in which they are purchasing, the types of properties purchased, and more. We also look at the experience REALTORS® have in working with domestic clients looking to buy property abroad.
What are the main takeaways from the report?
Matt Christopherson: There were fewer foreign buyers this past year, while their purchase dollar volume increased. This was due to continued price gains in the U.S. and foreign buyers generally looking at higher-priced homes compared to the typical domestic buyer. Purchasing just 98,600 homes (1.6% of U.S. existing home sales), foreign buyers had a purchase dollar volume of $59 billion (2.6% of the dollar volume of existing home sales). The nation with the highest percentage of buyers in the U.S. was Canada, and the state with the most foreign buyers was Florida. Foreign buyers primarily purchased detached single-family homes, and nearly half of them paid all-cash.
What are some key differences between last year’s report and the latest version?
Matt Christopherson: Some key differences and shifts are that there were fewer foreign buyers than last year, but they purchased a higher dollar volume, which is explained by rising U.S. home prices and the fact that foreign buyers generally are looking at and purchasing higher-dollar homes. However, foreign buyers remain at just under two percent of total home sales in the U.S.
What significant trend(s) stood out to you in the 2022 report?
Matt Christopherson: One primary trend that is important in this area of real estate is the share of foreign buyers that purchase with all-cash offers. This has always been high, and this past year, they bought with all-cash offers at nearly double the rate of domestic buyers: 44% purchased with all cash as compared to 24% of domestic buyers. This makes foreign buyers relatively unaffected by the rising mortgage rates we’ve been seeing and makes their offers very competitive.
What aspects of this report do you find most interesting?
Matt Christopherson: I find it most interesting to see which states and in which types of areas (suburban vs. urban centers, etc.) buyers from different countries purchase. For example, buyers from Canada, Brazil, and Colombia are most likely to buy in Florida, whereas buyers from China and India are most likely to purchase in California. Additionally, among the top 6 countries, buyers from Brazil are the most likely to purchase in a central city/urban area, buyers from India are most likely to purchase in a suburban area, and buyers from Colombia and Canada are more likely than others to purchase in small towns.