Home sales to foreign buyers drop to the lowest level in a decade amid COVID

·3 min read

Despite housing demand booming during the pandemic, foreign homebuyers in the U.S. have steadily declined for the fourth year in a row.

Foreign buyers purchased $54.4 billion in existing U.S. homes from April 2020 through March 2021, a 27% decrease from the previous year and the lowest in a decade, according to a new report from the National Association of Realtors.

COVID-19 caused a decline in international business and tourism travel, limiting foreign purchases to 107,000 properties, down 31% from the previous year. Both dollar and sales volume are the lowest since 2011, when the figures totaled $66.4 billion and 210,800 properties sold.

Foreign buyers who resided in the U.S. as recent immigrants or who hold visas to live in the states purchased $32.4 billion worth of existing U.S. homes, a 21% decrease from the year before. Foreign buyers who lived abroad made up the remaining $22 billion in sales, another decrease of 33%. As a whole, international buyers made up only 2.8% of the $5.8 trillion in existing-home sales.

“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,” NAR Chief Economist Lawrence Yun said in a statement. “Yet, even with the absence of foreign buyers, the U.S. housing market strengthened solidly.”

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China, Canada, India, Mexico and the United Kingdom were the top five countries of origin by U.S. residential sales dollar volume. China and Canada hold first and second place in sales dollar volume at $4.5 billion and $4.2 billion. India stood at $3.1 billion, Mexico at $2.9 billion and the United Kingdom at $2.7 billion.

Each country saw a drastic drop of 50% in dollar volume from the previous year.

The top U.S. destinations for foreign buyers were Florida, California, Texas, Arizona, New Jersey and New York. Florida has held the top spot for foreign buyers for the past 13 years and accounts for 21% of all international purchases. California stood at 16%, Texas at 9%, Arizona at 5% and New Jersey and New York at 4%.

Almost half, 43%, of foreign buyers purchase a property for a primary residence, with 49% of international buyers buying homes in the suburbs. Twenty-eight percent bought homes in urban areas, a figure that has stayed steady for six years. Only 7% bought property in resort areas.

“As travel restrictions loosen and foreign students return to U.S. colleges in the upcoming year, there is likely to be some growth in foreign buying of U.S. real estate,” Yun said.

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This article originally appeared on USA TODAY: Home sales to foreign buyers fell to the lowest level in a decade