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It’s been my experience that foreign investors are taking a “wait-and-see” approach to the US (residential) real estate market. They see potential … downside potential, that is. Too much risk of lower prices in the future, so they’re holding off. That prices haven’t dropped by very much in large US cities is the most-quoted reason.
Despite the Weak Dollar, Foreign Buyers Aren’t Rushing In – By June Fletcher, The Wall Street Journal
A report released August 7th by the National Association of Realtors revealed the curious fact that for 2008, for the 12 months ending in May, only 26% of 4,000 American real estate agents surveyed had at least one foreign client. In 2007, when a similar number of agents were surveyed, the proportion was much higher–32%. In both years, about half of the clients eventually bought a home, typically as a vacation home or investment. Those that didn’t, the agents said, were turned off by the cost of the property (54%), immigration laws that prevent foreign nationals from living in the United States year-round (27.4%) and property taxes (24.2%).
With higher commodity prices and a worsened global economy, we may never see the expected influx of foreign buyers. Meaning, no bailouts for local sellers, no hefty commission checks for agents.
