Purchases of homes by foreign buyers dropped a dramatic 36%, according to a report by the National Association of Realtors.
The report found that foreign buyers purchased $77.9 billion worth of U.S. existing homes from the 2019 survey reference period, a 36% decline from the $121 billion reached in the previous 12 months.
Non-resident foreign buyers accounted for $33.2 billion of U.S. existing-home sales, a 37% decline from the prior level of $53 billion.
Meanwhile, resident foreign buyers (i.e. recent immigrants) purchased $44.7 billion of residential property, a 34% drop from the prior level of $67.9 billion.
The top 5 countries with the most buyers of U.S. homes were China, Canada, India, the UK and Mexico.
Foreign buyers directed most of their purchases to the states of Florida, California, Texas, Arizona and North Carolina.
The report cited slowing economic growth in China, tighter controls on international money flows, a strong U.S. dollar and a lower inventory of homes for sale as the primary culprits in driving the declining sales.
The dollar volume of purchases also saw a decline, as well as average prices compared to levels during the previous 12 months. In the latest year, foreign buyers purchased 183,100 properties (266,800 in the previous period) at an average price of $426,100.
“A confluence of many factors – slower economic growth abroad, tighter capital controls in China, a stronger U.S. dollar and a low inventory of homes for sale – contributed to the pullback of foreign buyers,” says Lawrence Yun, NAR chief economist.
“However, the magnitude of the decline is quite striking, implying less confidence in owning a property in the U.S.,” Yun added.