There has been a huge jump in the number of Canadians buying real estate in the US, according to the US National Association of Realtors® (NAR) recently released 2017 Profile of International Activity in U.S. Residential Real Estate.
The annual survey examines the US real estate transactions between April 2016 and March 2017 by international buyers, as reported by more than 5,000 US real estate agents.
After falling from $11.2 billion in 2015 to $8.9 billion in 2016, US real estate purchases from Canadians cited in the 2017 survey totalled a $19 billion – a record figure for Canadian buyers.
Driven by the substantial increase in sales dollar volume from Canadian buyers, overall foreign investment in US residential real estate has skyrocketed, as transactions increased from every one of the top five countries where buyers originated.
Foreign buyers and recent immigrants purchased $153 billion of US residential property in 2016/17, which is a 49% rise from the previous year and a new record. Overall, 284,455 US properties were bought by international buyers in that 12-month period (up 32% from 2016’s survey).
Despite the surge in Canadian spending, China remained by far the top spender on US real estate in terms of sales dollar volume at $31.7 billion, which was up from last year’s $27.3 billion.
Lawrence Yun, NAR chief economist, observed that for Canadians, US property is expensive but still more affordable than in Canada. He said, “Inventory shortages continue to drive up US home values, but prices in five countries, including Canada, experienced even quicker appreciation. Some of the acceleration in foreign purchases over the past year appears to come from the combination of more affordable property choices in the US, and foreigners deciding to buy now knowing that any further weakening of their local currency against the dollar will make buying more expensive in the future.”
The 2017 survey also found that nearly half of all international purchases of US real estate were for homes located in just three states: Florida (22%), California (12%) and Texas (12%). Florida was also Canadians’ first choice, although Chinese buyers mostly preferred California.