Cross-Border Shopping For Real Estate Gains Popularity

Cross-Border Shopping For Real Estate Gains Popularity

It is no secret that one of the big pillars of the economy that needs to be bolstered before there can be economic recovery is the real estate market. With the struggling US economy, it is no surprise that Americans are having so much trouble with affording US real estate at present and likely for some time yet to come.

Increasingly, in the last year, foreign investors and expatriates have been taking advantage of low US home prices to purchase homes because of the relative cost of housing just across the border in Canada and Mexico as well as overseas.

Not surprisingly, Canadians are buying more US real estate than any of the other foreign interests. The Canadian dollar has been strong against the US dollar and Canadian home prices have been far more stable than those south of the border. This trend has resulted in many Canadians buying investment rental properties in the US or even buying a primary home and relocating to the US.

Properties bought by foreign investors have dropped in average value since last year but the number of homes sold has remained strong. The dip in median home prices bought is likely a reflection of the continuing price slump across much of the nation, making home buying even more attractive to buyers outside of the US economy.

Overseas buyers in the US real estate market include those from the UK, China, and Germany among the most represented. The theory behind this increase in homes bought by foreign investors is that non-American home buyers are looking at the US as a market with potential to increase in value over time and earn the owners some money. This real estate version of "buy low, sell high" may take some time yet to start to increase in value however, as some market experts are forecasting US housing markets taking over a decade to regain their pre-crash values.

Time will tell how much benefit the US market gains from the investments made by foreign buyers. It is unlikely that foreign investors all on their own will make a huge difference to the US residential real estate market, but every bit helps to boost economic support. For US home buyers to start buying more homes there will need to be a large resurgence in employment right across the nation; with so many Americans without jobs at present, the ability for the average American to buy a home is severely restricted.

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