People looking for a home in the United States from abroad most frequently end up buying a home in Florida. This is one of the most significant figures to emerge from the “International Transactions in the U.S. Residential Real Estate 2022” report that the National Association of REALTORS® (NAR) has been conducting annually among its members since 2009 to gauge the buying preferences of international customers in the U.S. real estate market.
The REALTORS® survey of the U.S. housing market
The report is based on an online survey of 150,000 randomly selected REALTORS® conducted between April and May 2022 and analyzes transaction information with international clients who bought and sold residential properties in the United States during the period from April 2021 to March 2022.
In greater detail, international customers include nonresident aliens (with permanent residence outside the United States) and resident aliens, i.e., non-U.S. citizens who have immigrated within the last two years or non-immigrant visa holders.
Inevitably, the scenario that emerges from this snapshot of the U.S. residential real estate market is heavily influenced by the Covid-19 pandemic during the period in question, which has seen a gradual easing of travel and entry restrictions in the United States relative to vaccination and quarantine requirements but has not yet reached pre-pandemic levels of tourist influx. In the real estate sector, the number of existing homes purchased by foreigners in the 12 months under review was the lowest recorded by the NAR since 2009, at 98,600 units, while due to rising U.S. home prices, the dollar volume increased by 18%.
The top foreign buyers of real estate in the United States were found to be:
- Canadians (11%)
- Mexicans (8%)
- Chinese (6%, a figure that is declining due to the pandemic)
- Indians (5%)
- Brazilians (3%)
- followed by Colombians, Germans, British, French, and Japanese.
Florida is the top U.S. destination for international buyers
Over the past year, Florida has been confirmed as the favorite destination for foreigners buying homes once again. No fewer than 24% of real estate transactions from abroad involve residential buildings in the Sunshine State, a 3% increase with respect to the previous period’s survey and representing a peak since as far back as 2012. This data confirms the tax advantages of moving to Florida, one of the most cost-effective states. Find out how much it costs to move to live in Florida.
But who are the international buyers of real estate in Miami and other Florida cities? Mainly South Americans (39%) and Canadians (25%), with a sharp increase in the latter. For many, Florida is the embodiment of the American dream in its own right. For Canadians, Mexicans, and Colombians, it is the country’s premier destination. 12% of Florida homebuyers are from Europe, while only 4% are Asian or Australian (travel restrictions during the pandemic weigh on this figure).
California is a strong contender behind Florida as the preferred state to buy homes in the U.S., with a market share of (11%). However, the state experienced a significant 5% decline in real estate purchases due to restrictions from Asian countries and Oceaniawhich are the main sources of foreign buyers. Texas ranks third with (8%) primarily chosen by Europeans and Mexicans. Completing the ranking of foreign buyers’ destinations are Arizona (7%), New York state (4%), and North Carolina (4%).
Latin America and the dream of moving to Florida
The REALTORS® survey clearly indicates that Florida has a strong pull for the Central and South American population, as evidenced by the fact that South American communities are among the most numerous and best integrated into all of Florida’s major cities. Moving to Miami, Orlando, Tampa or other coastal cities bordering the Ocean or the Gulf of Mexico seems to be the major goal of families living in Latin America, most likely attracted by Florida’s similarity of climate, scenery, and lifestyle to their home countries.
For Brazilians, Florida is the first choice when buying a home in the US. More than one in two Brazilian buyers choose the Sunshine State. The preference is even higher for Colombians, with 60% of them deciding to buy homes in Florida. Mexicans are not outdone either. Their favorite destination is Texas, partly because of its greater geographic proximity, but Florida comes next, in second place, with a flattering 12%, ahead of California and Arizona.
Canadians love Florida
For the past few years, Florida has been the top state destination for Canadians, a type of real estate buyer who is characterized by a greater aptitude than other nationalities for all-cash purchases: 69% of cases, according to the REALTORS® survey, compared with 65% of Colombians and 58% of Chinese. An additional peculiarity is the destination of use of the new property. Canadians buy properties in Florida and the rest of the United States predominantly as vacation homes (in 58% of cases, to be precise), while only 16% move their primary residence there in contrast to most South American, Chinese, and Indian buyers. It is precisely this specific intended use that directs searches for properties to buy in the U.S. by people living in Canada toward single-family homes and condominiums, residential solutions suitable for medium-to-long vacation stays, preferably located in urban and suburban areas: Canadians seek amenities, but do not disdain tranquility.
Buying a vacation home in Florida and property type
Canadians who buy homes in Florida to spend their vacations there are in good company, as 44% of foreign buyers of U.S. real estate use their new property as a vacation home or to rent it out. Only one-quarter of buyers residing in the United States buy homes for vacation or rent, while from abroad the trend is on the rise. This is in part a consequence of how the world has changed in the wake of the pandemic, with the increased opportunity to work from home and the sharp rise in rental costs prompting many people to choose to purchase property for this destination.
Among the property types preferred by international customers in recent months are single-family homes in the United States, chosen by 64% of overall buyers: both those from abroad (59%) and U.S. buyers (68%) opt for single-family villas, cottages, and townhomes. Among foreign buyers, there is a greater preference for townhouses, in suburban neighborhoods or central areas of major cities.
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