Main Content

Foreign Investment in United States’ Real Estate is Down, Marking an Opportune Time for Local Buyers to Invest

The Real Deal

Everything Real Estate in the San Fernando Valley
Tuesday July 7, 2020
Foreign Investment in United States’ Real Estate is Down, Marking an Opportune Time for Local Buyers to Invest

A little-known fact about the housing market is that foreign purchase of residential properties is a substantial force in the market from coast-to-coast. In fact, overseas real estate investments rose as high as $153B between 2011 and 2017; approximately 60% of foreign buyers are recent immigrants, while others purchase homes in the US as investment properties. Thus, foreign purchasers have a significant impact on housing prices vis-à-vis increased demand and deep pockets. Given the resurgence of COVID-19 in the United States, and the fact that we are essentially persona non grata to the rest of the world, that money-well is temporarily drying up. 
Less populace cities in the Midwest are unlikely to feel this burden much, as foreign investors don’t typically invest in properties where they are statistically less well received, but major coastal hubs like Los Angeles and New York City will feel the impact more pointedly. Pair that with this administration’s June 22, 2020 order barring immigrants from obtaining certain employment-based visas, and the problem becomes worse. 
This should be welcome news for buyers who have been priced out of the market by outside investors with very deep pockets. Moreover, without this factor artificially inflating the prices of homes, the issue of affordability should become less salient; houses become even more affordable when we consider historically low mortgage rates. 
It is a safe bet that once COVID-19 becomes less of an issue in the United States, foreign investment will resume, and housing prices will continue on their upward trajectory. As such, buyers who are considering waiting the virus out would be ill-advised to do so; the time to purchase homes is now. 
At the Chernov Team we understand that knowledge is power, and knowledge of how international investors impact the buyer-side housing market is powerful knowledge indeed. At the Chernov Team we know that whoever comes to the table most prepared leaves with the most, and the Chernov Team always leaves the table with the most.

More Blog Posts

To Love
Thursday September 18, 2020

Recently, the news has made it seem like our homes are not safe and while the Chernov Team does not believe we need...

Read Full Post
Thursday September 16, 2020

A confidence index measures a group of people’s optimism or pessimism about a future subject. While confidence in...

Read Full Post
Thursday September 14, 2020

During the pandemic, many of us find ourselves at home more than before the virus came to our shores; businesses sh...

Read Full Post
Thursday September 11, 2020

We talk about mortgage rates quite a bit here, and there’s a good reason – the current mortgage rate provides a...

Read Full Post
Thursday September 9, 2020

We’ve probably all heard about lavender oil, but not many of us actually use it. Once upon a time, this could be ...

Read Full Post
Thursday July 24, 2020

People are familiar with some name brand architecture designs like “Spanish Mission” and “midcentury modern,...

Read Full Post