Canadian and Mexican residents accounted for the largest share of U.S. residential real estate purchases last year while overall deals by foreign buyers dropped to its lowest volume in nearly a decade.
The 2021 International Transactions in U.S. Residential Real Estate report from the National Association of Realtors shows “international buyers purchased 107,000 U.S. residential properties totaling $54.4 billion from April 2020-March 2021, down 31% and 27% respectively, from the previous year and the lowest volumes since 2011.” It’s not breaking news that foreign buyers are absent from the market given the divergence of global economies due to the pandemic. NAR chief economist Lawrence Yun confirms the effects COVID-19 has had on the market: “The big decline in foreign purchases of homes in the U.S. in the past year is no surprise given the pandemic-induced lockdowns and international travel restrictions.”
The buyer pool, which was reshaped by global travel restrictions, also shifted during the pandemic. The top country for those buyers was Canada, followed by Mexico. China, which held the top spot since 2015, slipped to third place. India and the United Kingdom tied for fourth place on the list.
Buyer profiles change when looking at “region of origin.” The report finds Asia and Oceania accounted for the largest group of buyers at 22%, followed by Latin America and the Caribbean at 19%, then Europe with an 11% share. North America (Canada) accounted for 8%, while Africa accounted for 4%. A larger fraction of foreign buyers, at 35%, were from a “country that the respondent did not identify.”
Cash remains king among foreign buyers, whose all-cash offers are often key to winning bids in today’s market. “Foreign buyers tend to be all-cash buyers, which is always competitive,” observes Warburg Realty agent Parisa Afkhami.