Foreign buyers purchased residential properties for a variety of reasons and across geographic areas, with the prices of properties purchased typically above those of domestic buyers, according to NAR’s recently released 2016 Profile of International Activity in U.S. Residential Real Estate.

On average, foreign buyers paid $477,462 which is higher than the average price of all existing homes sold in the U.S. at $266,683.[1]  In terms of the typical residential property purchased by foreign buyers, the median price of these properties was $277,380 compared to $223,058 for all existing homes sold in the U.S. in the same time period.[2]

foreign buyer ehsmed pricesAmong the major foreign buyers, Chinese buyers purchased residential properties that were more expensive than properties purchased by other buyers. This can be attributed to the tendency of Chinese buyers to purchase residential properties in central cities and suburban areas with relatively higher property prices such as California, Washington, and New York. In contrast, Canadians mostly purchased residential properties in Florida and Arizona where properties may be cheaper.

average pricesmed foreign priceApproximately 36 percent of residential clients viewed U.S. property prices to be less expensive than prices in their home country, while 24 percent viewed U.S. prices as more expensive than prices in their home country, and 10 percent viewed U.S. prices to be about the same as in the home country. Roughly three in 10 respondents were not sure how their residential clients viewed U.S. home prices comparatively.

international prices

[1] The mean or the average price is used to calculate the dollar volume of purchases and can be used as a measure of central tendency. It is found by summing the responses and dividing by the number of responses.

[2] The median is the middle value of the distribution. Half of all purchases fall below this value and half are above this value. Because home values tend to skew to the higher end, the median is often a better reflection of typical market activity.

Source: Economy

Copyright NATIONAL ASSOCIATION OF REALTORS®. Reprinted with permission.

This Article Appears Courtesy of Steven Diadoo

Steven Diadoo, Licensed Realtor in MN with BRIDGE REALTY and best-selling author of 'Road to Success' with Jack Canfield (Chicken Soup for the Soul), Board Member at Bowling for Brains Non-Profit 501(c)3 (Event to benefit the American Brain Tumor Association), licensed Realtor with Bridge Realty, Seen on DIY TV, Create Channel and PBS. For help buying and/or selling a house, please call (952) 270-6141 or Click here.