As international real estate investment took a slight downward turn on the national stage, Texas stayed in the arena riding the bull market to more than $10 Billion from April 2015 to March 2016. According to the National Association of Realtors, almost 10% of homes bought by international buyers in the United States stand in Texas; that tells us one of every ten homes purchased by international buyers put dollars in the Texas economy. In bricks and mortar, that means about 21,500 homes and over $10 Billion in sales benefited the Lone Star State providing a 2 percent increase over last year in the international home buying market.
During this period, Texas rose to number three in the country for international home buying activity making positive progress against California and Florida. Over the last decade, Texas has done everything possible to attract the foreign investor by removing and smoothing barriers to an international home buyer wishing to buy in Texas. The legislature worked diligently to put Texas in the competition with an eye to beating out California for international dollars, and the strategy is paying off.
With a strengthening U.S. dollar, Brexit, a presidential election, and the Treasury Department’s luxury cash-buyer rules, many were concerned the foreign home buyers market in the United States might decline. Ironically, Brexit served to showcase the security and stability of the U.S. market as evidenced by the gains seen in Texas. After the Brexit vote, the U.S. housing market witnessed not only an influx of international buyers; but, buyers exploring markets out of the traditional international comfort zones. Two of the areas explored and embraced were Austin and Houston.
The Texas Appeal
Dallas Realtor and Chairperson of the Texas Association of Realtors, Leslie Rouda Smith, said in a press release, “Over the last several years, Texas has become increasingly popular among international homebuyers from all parts of the globe for relocations, investment properties, and vacation homes.” The economy and stability aren’t the only factors in why Texas is attracting the international home buyer. Some of the reasons gleaned from the purchasers themselves include the presence of relatives, friends and associates, proximity to their native country, employment and educational opportunities, location and climate top the list of the primary considerations. A great many foreign home buyers are purchasing single-family homes as a residence for their children attending U.S. colleges and universities.
While other markets for international home buyers have experienced a larger portion of Chinese buyers, one in every five home buyers from India chose Texas as well as one in every three home buyers from Mexico. Texas boasts six metro areas among the top 50 in America for immigration. Houston is the leader at number five, followed by Dallas-Fort Worth at number eight, Austin at number 26, San Antonio number 28, El Paso number 32 and McAllen at number 44.
Interestingly, 62% of foreign home buyers buy with cash. Statistics show, international buyers from Canada, the United Kingdom, and China are more likely to pay in full. Concurrently, international buyers from Mexico and India are more apt to obtain mortgage financing. Buying data shows buyers from India and Mexico, the strongest purchasers in Texas, tend to be resident buyers acquiring primary residences, making them much more likely to obtain financing from U.S. Sources.
Texas has its hand wrapped firmly around the bull rope of the international home buying beast. According to surveys conducted with real estate professionals operating in the international arena, the outlook for continued activity is positive. 44% of those responding expect an increase in activity involving international clients with only 12% expecting any decrease. That is good news for the housing market and the Great State of Texas.
Considering a move to Texas?
Whether you’re traveling internationally or simply looking to house up in the Lone Star State, our mortgage professionals are here to help you with your financing needs. Contact us today to receive more information about the area, and financing options to best fit your needs, (972) 591-3097.