Foreign buyers helping housing market
The sky is not falling for the foreign buyers who are looking for a piece of the American dream. Bankrate.com reports that 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% in the 1980’s and nearly 30% in the 1990’s, grew to 40% between 2000 and 2005.
“Basically, this country’s household growth depends on Foreign-born households,” says Zhu Xiao Di, senior research analyst for the center.
There are many reasons attracting the foreign buyer, essentially anyone can buy today at 2004 price levels, but you add in the currency exchange rate for the Euro and people from Europe basically purchase at near the 2002 price point. In addition, the foreign buyer is nearly 4 times more likely to pay cash for their homes than their U.S. counterparts, therefore not really concerned about the banking and mortgage issues we are dealing with here in the United States.