As affordable housing diminishes across the country, the international real estate buyer occasionally emerges as a bogeyman. Take Weymi Cho, a Chinese heiress with her own reality TV show, who lives in $4 million condo in Vancouver. Surely buyers like these are partly to blame for our affordability crisis, right?
Well, not in Colorado at least. A survey from the National Association of Realtors found that the state only accounted for 1 percent of foreign real estate buyers from April 2016 to March 2017.
As a matter of fact, five states accounted for more than half of real estate purchased by international people. Those states are Florida (22 percent), Texas (12 percent), California (12 percent), New Jersey (four percent), and Arizona (four percent).
Colorado, again, made up only about 1 percent of foreign real estate purchases.
Why not us? NAR found that the states with lots of foreign real estate purchases were warm places or places close to the home country in some way:
“Florida and Arizona attracted buyers from Latin America, Europe, and Canada who tend to purchase properties in warm climates for vacation purposes. California and New Jersey drew Asian buyers, most likely for reasons related to geographic proximity, cultural similarities, and job opportunities. Texas, which is physically close to Latin America and home to a large Latino population, attracted buyers from Latin America and the Caribbean as well as Asian buyers,” the study said.
It’s further worth noting that majority of foreign buyers nationwide, 58 percent, were people who mostly live in the United States, according to the survey. Relatedly, about half of these homes became permanent residences for foreign buyers. In other words, most of these homes aren’t empty investments, they are places where our neighbors live.
China is a major source of foreign real estate transactions in the U.S. though. Chinese buyers purchased $31.7 billion in real estate over the survey period, well outpacing Canada’s $19 billion in purchases, according to the survey.