News: Foreign buyers may help housing market

NORTH PALM BEACH, Fla. – Sept. 7, 2007 – Looking for a ray of sunshine in today’s overcast housing market? Here’s one: Foreign buyers still want a piece of the American dream.In fact, it’s somewhat ironic that immigration has become a key domestic debate in the lumbering 2008 presidential campaign. Foreign-born buyers have not only contributed substantially to the growth of the U.S. housing sector but continue to help soften the landing as the market wobbles to correct itself. According to the 2007 “State of the Nation’s Housing” report from Harvard University’s Joint Center for Housing Studies, the percentage of foreign-born buyers that contributed to net household formations, previously 15 percent in the 1980s and nearly 30 percent in the 1990s, grew to 40 percent between 2000 and 2005. They’re coming to America all right, at a rate of 1.2 million net immigrants annually since 2000.

A record 12 million additional immigrants are expected to arrive between 2005 and 2015. “Basically, this country’s household growth depends on foreign-born households,” says Zhu Xiao Di, senior research analyst for the center. Little wonder, then, that during the last 12 months, one in three Realtors worked with an international client or prospect and nearly one in five sold a home to a foreign buyer, according to the “2007 National Association of Realtors Profile of International Home Buying Activity” released July 30.

Those numbers are likely to grow as foreign investors, bolstered by favorable exchange rates, take advantage of the cooling U.S. housing market to snatch up great deals on vacation homes, particularly in Florida, California and New England.
(c) 2007 bankrate.com