- National Association of Realtors

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- National Association of Realtors
2015 Profile of International Home Buying Activity of
International Clients
For the Twelve Month Period Ending March 2015
National Association of REALTORS®
2015 Profile of Home Buying Activity of
International Clients
NATIONAL ASSOCIATION OF REALTORS®
Research Division, June 2015
Lawrence Yun, Senior Vice President & Chief Economist
Jed Smith, Managing Director, Quantitative Research
Gay Cororaton, Research Economist
Dollar Volume of Residential Sales to Foreigners
A $104 Billion Market, 12 Months Ending March 2015
Dollar Volume of Residential Sales to Foreigners
In Billion Dollars
$120
$104
$100
$92
$82
$80
$66
$66
2010
2011
$68
$60
$40
$39
$20
$0
2009
2012
2013
2014
2015
Two Types of International Clients
Sales, in Billion Dollars
Twelve Months Ending March 2015
Resident, $49
Non-resident,
$54
Total Number of Sales to Foreigners
Decreased, 12 Months Ending March 2015
Number of Sales Transactions to Foreigners
350,000
300,600
300,000
250,000
210,800 206,200
192,400
200,000
150,000
232,600
209,000
157,200
100,000
50,000
0
2009
2010
2011
2012
2013
Note: 2009 Survey captured only non-resident foreign clients
Note: 2009 Survey captured only non-resident foreign clients
2014
2015
International Clients Purchase at Upper End of Market
Mean Prices: All Buyers vs. International Clients
12 Months Ending March 2015
2014
$600,000
$548,100
$450,700
$500,000
$400,000
$300,000
$200,000
$100,000
$0
2015
$396,200
$255,600
$228,400
$396,200
$499,600
$396,200
International Clients: Region of Origin
Middle East
4%
Region of Origin of International Clients
12 Months Ending March 2015
Unknown Africa
1%
3%
Canada
14%
Latin America
(inc. Mexico)
23%
Asia/Oceania
35%
Europe
20%
Origin of Purchaser by Region
Florida and California
12 Months Ending March 2015
Region of Origin of International
Clients Purchasing
in Florida
Region of Origin of International
Clients Purchasing
in California
57%
35%
27%
28%
18%
7%
0%
1%
1%
2%
14%
6%
1%
2%
Origin of Purchaser by Region
Texas and Arizona
12 Months Ending March 2015
Region of Origin of International
Clients Purchasing
in Texas
Region of Origin of International
Clients Purchasing
in Arizona
46%
41%
31%
19%
15%
4%
4%
4%
1%
0%
15%
19%
2%
0%
Average Home Purchase Price
By Country of Purchaser
12 Months Ending March 2015
$831,800
$460,200
$455,600
$472,200
U.K.
Others
$499,600
$380,300
$274,800
Canada
China
India
Mexico
All
Major Countries of Origin of Buyers
Percentage of Total International Sales Measured in Unit Volume as of 12
Months Ending March of Respective Year
30%
25%
20%
15%
10%
5%
0%
2010
2011
2012
2013
2014
2015
Canada
23%
23%
24%
23%
19%
14%
China*
9%
9%
12%
12%
16%
16%
India
5%
7%
6%
5%
5%
8%
Mexico
10%
7%
8%
8%
9%
9%
* Includes People's Republic, Hong Kong, and Taiwan
U.K.
9%
7%
6%
5%
5%
4%
Germany
4%
4%
3%
3%
3%
3%
France
3%
4%
3%
2%
2%
3%
Venezuela
1%
3%
3%
2%
2%
2%
China and India of Increasing Importance
Chinese Dollar Volume Substantial
12 Months Ending March 2015
Estimate of Sales to International Clients from Top 5 Countries
( In Billion Dollars)
Canada
China
India
Mexico
United Kingdom
2009/1
$8.9
$4.1
$6.0
$4.1
$6.6
2010
$17.1
$11.2
$5.0
$6.5
$12.1
Total International Sales $39
$66
Top 5, % share
76%
79%
*China includes PROC, HK, Taiwan
/1 2009 estimate only captured Non-resident clients.
Source: NAR
2011
$13.0
$7.0
$5.1
$4.2
$6.5
2012
$15.9
$12.0
$5.2
$6.5
$4.4
2013
$11.8
$12.8
$3.9
$3.6
$4.2
2014
$13.8
$22.0
$5.8
$4.5
$5.8
2015
$11.2
$28.6
$7.9
$4.9
$3.8
$66
54%
$82
53%
$68
53%
$92
56%
$104
54%
Top Four States of Interest
Florida, California, Texas, and Arizona
Major Destination of International Clients, 12 Months Ending March of Respective Year
(State's Share of all International Unit Sales )
35%
30%
25%
20%
15%
10%
5%
0%
Florida
California
Texas
Arizona
New Jersey
New York
Illinois
Washington
Michigan
Hawaii
2010
22%
12%
8%
11%
2%
4%
1%
1%
2%
2%
2011
31%
12%
9%
6%
3%
3%
3%
2%
1%
2%
2012
26%
11%
7%
7%
1%
4%
3%
4%
3%
2%
2013
23%
17%
9%
9%
2%
3%
2%
2%
2%
2%
2014
23%
14%
12%
6%
3%
3%
3%
4%
2%
2%
2015
21%
16%
8%
5%
3%
3%
3%
3%
2%
2%
Why Do Foreigners Buy U.S. Residential Real Estate?
12 Months Ending March 2015
Intended Use of Property Purchased by International Clients
(Percentage distribution)
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
46%
20%
15%
11%
3%
Vacation
home
Residential Vacation
rental
and Rental
2%
3%
Primary Commercial For student Don't know
residence
rental
in U.S.
Majority of Sales Are Cash
12 Months Ending March of Respective Year
Group of investors/Others/Don’t Know
With mortgage financing
All cash (no mortgage
100%
3%
3%
2%
1%
2%
2%
2%
2%
44%
36%
37%
35%
38%
62%
62%
63%
60%
55%
2011
2012
2013
2014
2015
4%
90%
80%
70%
60%
54%
52%
41%
69%
50%
40%
30%
20%
10%
43%
46%
2008
2009
55%
28%
0%
2007
2010
Value of Dollar Impacts International Purchases
Helps to Explain Decline in Sales 12 Months Ending March 2015
Not much of an effect
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
37%
38%
Moderate effect
Very significant effect
39%
35%
33%
31%
44%
44%
39%
42%
40%
43%
23%
21%
21%
22%
24%
25%
2009
2010
2011
2012
2013
2014
Price of U.S. Home, Based on Currency of Buyer
A Rising Dollar Made U.S. Residential Property More Expensive
Price in Local Currency of a U.S. Existing Home Purchased
in 2015Q1
Local Currency, Thousands
If purchased at 2014Q1 Exchange Rate
If purchased at 2015Q1 Exchange Rate
700
600
500
400
300
200
100
-
583
451
211
252
115 134
Canadian Dollar
British Pound
139
181
Euro
Brazilian Real
Average Purchase Price by Year
12 Months Ending March of Respective Year
Mean Purchase Price, U.S. Existing Home Sales
Mean Purchase Price, International Clients
$255,600
2015
$499,600
$247,400
2014
$228,400
2013
$396,200
$354,200
2012
$212,200
2011
$217,800
2010
$217,500 $311,400
$232,400 $337,600
2009
$-
$100,000
$200,000
$405,000
$315,900
$300,000
$400,000
$500,000
$600,000
A Significant Number of REALTORS® Reported Having
Foreign Clients
12 Months Ending March of Respective Year
Percent of REALTORS® with International Clients
40%
38%
36%
34%
32%
30%
28%
26%
24%
22%
20%
35%
32%
28%
28%
2010
2011
26%
27%
27%
2012
2013
28%
23%
2007
2008
2009
2014
2015
How Do REALTORS® Obtain International Clients?
12 Months Ending March 2015
Referrals /Leads
Through friends
19%
Through previous contacts/clients
Through referral from an international
source
26%
2%
Through referral from a domestic source
9%
Walk-in to Office/Open House/Phone call
11%
Website/Online listing
Signs/Ads on boards/yards
Other
20%
4%
9%
A Specialized Market: 5 Percent Had More than 5 International Buyers
12 Months Ending March of Respective Year
0
100%
1%
3%
2%
3%
1 to 5
6 to 10
2%
4%
2%
5%
90%
11 or more
1%
4%
2%
4%
2%
3%
80%
70%
49%
61%
60%
51%
63%
62%
70%
67%
50%
40%
30%
20%
47%
44%
35%
31%
31%
2010
2011
2012
10%
24%
27%
2013
2014
0%
2009
2015
Not All Clients Buy:
Reasons Given for Clients Not Purchasing
(Multiple Responses Permitted, 12 Months Ending March 2015)
20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
18%
17%
17%
14%
10%
7%
5%
5%
1%
1%
7%
How Has Number of Clients Changed in Past 5 Years?
12 Months Ending March 2015
Not applicable, have been in business less than 5 years
Decreased
Stayed about the same
Increased
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
15%
19%
17%
19%
10%
9%
9%
7%
56%
53%
55%
53%
15%
19%
19%
18%
2009
2010
2011
2012
19%
9%
57%
26%
25%
6%
7%
48%
51%
21%
20%
17%
2013
2014
2015
Conclusions
• International Clients: A Niche, Upscale Market
– A Slowly Growing Market: Prices up
– Greater Concentration of Sales in Upper Brackets
– Sales to Both Resident and Non-Resident Foreigners.
• A Niche Market: Overall Share is 8 Percent of Existing Home Sales Dollar
Volume.
– Of Greater Importance in a Number of States—Florida, California, Arizona,
Texas.
• Purchases for a Variety of Purposes: Investment, Vacation, Residential.
• An Upscale Market
– Prices Significantly Above Median Price.
• Requires Specialized Skills.
– Cultural Awareness.
– Real Estate Practices on an International Basis

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