2014 International Home Buyer Survey

WORKING WITH
INTERNATIONAL
HOME BUYERS IN
CALIFORNIA
Presented by
Carmen Hirciag
Senior Research Analyst
THINK GLOBALLY
What is going on in the world economy?
GLOBAL GDP EXPECTED TO IMPROVE
US GDP GROWTH HAS BEEN MODERATE

ANNUAL PERCENT CHANGE, CHAIN-TYPE (2005) $
6%
2014 QUARTERLY
ANNUAL
5%
4.6%
5.0%
4%
3%
3.1%
2.7%
1.9%
2%
2.8%
2.4%
1.9%
1.8%
1%
0%
-0.3%
-1%
-2%
-2.1%
-3%
-3.1%
-4%
2005
2006
2007
2008
2009
2010
SERIES: GDP
SOURCE: US Dept. of Commerce, Bureau of Economic Analysis
2011
2012
2013
Q1-14 Q2-14 Q3-14
GLOBAL UNEMPLOYMENT DECLINING
US & CA UNEMPLOYMENT RATES FALLING SLOWLY
14%
CA
US
12%
10%
8%
7.2%
6%
5.8%
4%
2%
0%
SERIES: Unemployment Rate

SOURCE: US Bureau of Labor Statistics, CA Employment Development Division
US & CA LABOR FORCE PARTICIPATION RATE ALSO

FALLING SLOWLY
CA
69%
67%
65%
63%
61%
59%
SERIES: Labor Force Participation Rate

SOURCE: BLS, Data Buffet
US
GLOBAL INFLATION STEADY
US INFLATION IS HEALTHY
6%
5%
4%
3%
2%
1%
0%
-1%
-2%
-3%
SERIES: Consumer Price Index

SOURCE: US Bureau of Labor Statistics
DOLLAR VALUE RISING

Value of Dollar Vs Basket of Currencies
140
130
120
110
100
90
80
70
60
SOURCE: Federal Reserve Board
2014.01
2013.01
2012.01
2011.01
2010.01
2009.01
2008.01
2007.01
2006.01
2005.01
2004.01
2003.01
2002.01
2001.01
2000.01
50
FDI NET INFLOWS GROWING

$350.0
$300.0
Billions of $
$250.0
$200.0
$150.0
$100.0
$50.0
$0.0
Source: The World Bank
FDI IN REAL ESTATE DOWN

$4,000.0
$3,500.0
Millions of $
$3,000.0
$2,500.0
$2,000.0
$1,500.0
$1,000.0
$500.0
$0.0
Source: Bureau of Economic Analysis
INTERNATIONAL HOME BUYERS IN

THE U.S.
INTERNATIONAL PURCHASES ACCOUNT FOR 7% OF

REAL ESTATE TRANSACTIONS IN U.S.
Sales (Billions)
Foreigners (nonUS resident)
3%
Foreigners (US
resident)
4%
Non-internation
al
93%
Source: NAR 2014 Profile of International Home Buying Activity
COUNTRY OF ORIGIN OF INTERNATIONAL BUYERS

Canada
19%
China
16%
Mexico
9%
India
5%
UK
5%
0%
5%
10%
15%
20%
INTERNATIONAL BUYERS PREFER FL

25%
23%
20%
15%
14%
12%
10%
5%
0%
6%
4%
CALIFORNIA HOUSING MARKET

The Impact of International Home Buyers
SURVEY METHODOLOGY
email to random sample of CA REALTORS in OctoberNovember 2014
466 respondents
closed escrow within 12 months prior to October/November
2014 with an international client (one who is not a citizen or
permanent resident of the US)
AGENTS GENERAL
INTERNATIONAL BUSINESS
CLOSED TRANSACTIONS IN THE PAST 12 MONTHS

DECLINED
Median
12
11
9
10
8
6
4
2
0
2013
Q. How many real estate transactions did you close during the past 12 months?
SERIES: 2014 International Home Buyer Survey
SOURCE: CALIFORNIA ASSOCIATION OF REALTORS
2014
SLIGHTLY MORE REALTORS CLOSED A TRANSACTION

WITH AN INTERNATIONAL CLIENT IN 2014
18%
16%
17%
16%
14%
12%
10%
8%
6%
4%
2%
0%
2013
2014
Q: How many of those closed transactions involved an international client (one whose permanent residence is located outside the
United States)?
# OF TRANSACTIONS CLOSED DECLINED

Median
3.3
2.9
3.5
# of Transactions
3
2.5
2
1.5
1
0.5
0
2013
2014
Q: How many of those closed transactions involved an international client (one whose permanent residence is located outside the
United States)?
LAST TRANSACTION
MAJORITY ARE BUYERS

Buyer
100%
80%
Seller
Both
12%
8%
30%
22%
57%
70%
60%
40%
20%
0%
2013
2014
Q: Which side did you represent?

MAJORITY BOUGHT IN SOUTHERN CALIFORNIA

2013
70%
60%
2014
65%
54%
50%
40%
29%
23%
30%
12%
20%
10%
0%
Southern CA
Northern CA
Q: Where was the property in your closed transaction with an international client located?
Other CA
18%
TOP COUNTIES FOR INTERNATIONAL BUYERS

County
Percentage of Clients
Los Angeles
20%
San Diego
9.3%
Riverside
9.0%
Orange
8.7%
Alameda
7.9%
Santa Clara
5.4%
Sacramento
5.1%
Contra Costa
4.5%
San Mateo
3.7%
San Francisco / San Bernardino
2.8%
Q: Where was the property in your closed transaction with an international client located?
MOST SALES NOT DISTRESSED

2013
2014
89%
90%
79%
80%
70%
60%
50%
40%
30%
20%
8%
10%
4%
7%
3%
5%
0%
Equity Sale
REO Sale
Q: What type of purchase did your last international client(s) make?

Short Sale
Other
4%
MEDIAN LISTING PRICE UNCHANGED

$500,000
$500,000
2013
2014
$500,000
$450,000
$400,000
$350,000
$300,000
$250,000
$200,000
$150,000
$100,000
$50,000
$0
Q: What was the initial listing price of the property in your last closed transaction with an international clients?
MEDIAN FINAL SALE PRICE: $490,000
6%
$2M+
16%
$1M to $1.9M
4%
4%
$900,000 to $999,999
$800,000 to $899,999
5%
$700,000 to $799,999
7%
6%
$600,000 to $699,999
$500,000 to $599,999
14%
13%
12%
13%
$400,000 to $499,999
$300,000 to $399,000
$200,000 to $299,999
Less than $200,000
0%
2%
4%
6%
8%
10%
12%
Q: What was the final sale price of the property in your last closed transaction with an international client?
14%
16%
18%
MEDIAN FINAL SALE PRICE DROPPED 1.5%

Median
$500,000
$450,000
$497,500
$490,000
$400,000
$350,000
$300,000
$250,000
$200,000
$150,000
$100,000
$50,000
$0
2013
2014
SALE PRICE 2% LOWER THAN LIST PRICE

Median
$500,000
$450,000
$500,000
$490,000
List
Sale
$400,000
$350,000
$300,000
$250,000
$200,000
$150,000
$100,000
$50,000
$0
MAJORITY INTEND TO USE THE PROPERTY AS A

PRIMARY RESIDENCE OR INVESTMENT
43%
Primary Residence
36%
33%
Investment/Rental Property
29%
20%
Vacation/Second Home
Other
2013
29%
4%
0%
0%
5%
10%
2014
15% 20% 25% 30%
35% 40% 45% 50%
Q: What was the intended use of the property in your last closed transaction with an international client?
MORE BUYERS PURCHASING PROPERTIES BELOW

$500K FOR INVESTMENT
120%
100%
2%
80%
40%
20%
4%
4%
34%
33%
25%
60%
40%
3%
17%
19%
21%
20%
Other
Investment
Vacation/2nd home
Primary residence
56%
37%
43%
43%
0%
below $500k $500k-$1M Above $1M
All buyers
MORE BOUGHT CONDOS/TOWNHOMES

67%
Residential detached SFH
59%
23%
28%
Residential condo/townhome
4%
5%
Residential MFH
2014
4%
6%
Other
Comercial retail space
1%
2%
Commercial office space
1%
1%
0%
10%
2013
20%
30%
Q: What type of property did your last international client purchase/sell?

40%
50%
60%
70%
80%
NEARLY HALF BOUGHT IN THE SUBURBS

48%
Suburban
42%
33%
Central city/urban
38%
10%
9%
Small town/rural area
2014
2013
9%
9%
Resort area
1%
2%
Other
0%
10%
20%
30%
40%
Q: Please select the category that best describes the location of the property in your last
closed transaction with an international client?
50%
60%
MEDIAN SQUARE FEET: 1,900

5,000+ ft
8.2%
4,000 - 4,999 ft
2.9%
3,000 - 3,999 ft
9.6%
2,000 - 2,999 ft
28%
1,000 - 1,999 ft
45%
< 1,000 ft
6.6%
0%
5%
10%
15%
Q: How many square feet did the property have?

20%
25%
30%
35%
40%
45%
50%
MEDIAN SQUARE FEET 5% LOWER IN 2014

Median
S
q
u
a
r
e
F
e
e
t
2,000
1,800
1,600
1,400
1,200
1,000
800
600
400
200
0
2,000
2013
Q: How many square feet did the property have?

1,900
2014
WHY BUY NOW?

2014
2013
23%
To rent out property
14%
15%
Changed jobs/relocated
12%
10%
Change in family status
4%
To flip for profit

0%
5%
Q: What was your clients main reason for buying now?

10%
15%
20%
25%
MAJORITY ONLY CONSIDERED THE U.S.

Only US
100%
90%
Other countries
22%
25%
78%
75%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2013
Q: In which cities outside the U.S. did your buyer consider purchasing real estate?
2014
WHY THE UNITED STATES?

2014
2013
To be closer to friends and family
21%
30%
22%
Other
Investment/tax advantages
20%
8%
13%
Child attending college
13%
Business
6%
Acquire legal status

0%
5%
10%
Q: Why did your last international buyer choose to purchase in the U.S.?
15%
20%
25%
30%
35%
MORE BUYERS PURCHASING PROPERTIES ABOVE $1M

FOR INVESTMENT & BUSINESS
To be closer to family/friends
Investment/tax advantages
$1M+
Business
$500k-$1M
below $500k
All buyers
Child attending college

Acquire legal
status/immigration
0%
10%
20%
30%
40%
50%
FEWER FIRST TIME BUYERS
60%
59%
50%
54%
40%
30%
20%
10%
0%
2013
2014
Q: In your last closed transaction with an international client, was that the buyers first home purchased in the U.S.?
96% OF INTERNATIONAL BUYERS OWN OTHER

PROPERTIES
30%
26%
27%
25%
19%
20%
15%
11%
10%
6.8%
5%
2.7%
0%
1
Q: How many other properties does your last international buyer own?
6+
AVERAGE NUMBER OF OTHER PROPERTIES OWNED

DECLINED
3.2
3.5
2.8
3.0
2.5
2.0
1.5
1.0
0.5
2013
Q: How many other properties does your last international buyer own?
2014
MORE CLIENTS HIRED PROFESSIONALS TO HELP

FACILITATE TRANSACTION IN 2014
25%
23%
20%
15%
13%
15%
Attorney
Accountant
10%
7%
5%
0%
2013
2014
Q: Did your client hire any of the following professionals to help facilitate the transaction?
FEWER PROPERTIES FOUND OFF THE MLS

MLS
My listing
Other
Client found property
2014
Off-MLS Listing
2013
Open house
Builder
Advertisement
From seller directly
0%
10%
20%
Q: How did you find the property for your international buyer?
30%
40%
50%
60%
70%
BUYERS INTEND TO KEEP THE PROPERTY LONGER

Median
7
# 6
o
f
Y 3
e
a 2
r
s 1
0
2013
Q: How many years does your last international buyer intend to keep the property?
2014
MORE PROPERTIES MANAGED BY PROPERTY

MANAGERS IN 2014
Owner
100%
Property Manager
Other
11%
13%
36%
38%
53%
49%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2013
2014
Q: Who will manage the property in your last closed transaction with an international client?
FINANCING
FEWER INTERNATIONAL BUYERS PAID CASH

All cash
100%
90%
Cash from financing in home country
31%
Obtained financing in US
35%
80%
3%
70%
60%
50%
40%
69%
63%
30%
20%
10%
0%
2013
Q: How did your last international buyer pay for the property?
2014
MORE BUYERS PURCHASING PROPERTIES BELOW

$500K PAID CASH
100%
90%
80%
70%
31%
40%
39%
2.8%
1.5%
3.2%
60%
35%
3.0%
50%
Cash from financing in

home country
40%
30%
66%
57%
60%
63%
20%
10%
0%
below
$500k
Obtained US financing
$500k-$1M Above $1M All buyers

All Cash
DOWN PAYMENT DECLINED
30%
30%
25%
23%
20%
15%
10%
5%
0%
2013
2014
Q: How much was the down payment for the home purchased (as a percentage of the sale price)?
DOWN PAYMENT CAME MOSTLY FROM PERSONAL

SAVINGS
2014
2013
85%
82%
Personal savings
11%
15%
Proceeds from a sale of previous property
7%
5%
Gift
5%
2%
Sale of personal assets (other than real property)
3%
2%
Other
0%
10% 20% 30% 40% 50% 60% 70% 80% 90%
Q: What was the source of the down payment in your last closed transaction with an international buyer? N=87
MORE ACQUIRED FIXED RATE LOANS IN 2014

2013
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
80%
2014
84%
16% 14%
5%
Fixed rate
Adjustable rate
Q: What type of loan did your last international buyer acquire?

Other
2%
MORE ACQUIRED 30-YEAR LOAN TERMS

2013
80%
2014
78%
71%
70%
60%
50%
40%
30%
20%
10%
10%
15%
8%
8%
5%
6%
0%
30 years
10 years
Other
Q: What is the duration of the loan in your last closed transaction with an international buyer?
15 years
OBTAINING FINANCING IS LESS DIFFICULT
6.0
5.0
5.0
4.6
4.0
3.0
2.0
1.0
0.0
2013
2014
Q: Please rate how easy or difficult it was for your last international buyer to obtain financing. (1=Very easy, 10=Very difficult)
MAJORITY DIDNT HAVE PROBLEMS WITH

TRANSACTION
16%
Finding a property
15%
Bringing funds into the US

3%
Immigration
2%
Finding insurance
1%
Figuring out property taxes

0%
2%
4%
6%
8%
10%
Q: What, if any, other problems did your last international buyer encounter with the transaction?
12%
14%
16%
CLIENT / AGENT RELATIONSHIP
REFERRALS ARE BEST WAY TO FIND

INTERNATIONAL BUYERS
Referral from a friend
22%
Referral from a previous buyer
21%
Client found me online
15%
Client is a friend
7%
Open house
7%
Referral from another agent
6%
Client responded to my ad
5%
"For Sale" sign
4%
Prior dealings with my brokerage
2%
0%
Q: How did you find your last international client?

5%
10%
15%
20%
25%
INTERNATIONAL WEBSITES ARE GOOD WAY

TO REACH FOREIGN BUYERS
38%
International websites
2%
International magazines
2%
International social media
0%
5%
10%
Q: How did you market yourself to international clients?

15%
20%
25%
30%
35%
40%
EMAIL IS MOST POPULAR FORM OF

COMMUNICATION
60%
55%
50%
40%
30%
30%
20%
8%
10%
6%
1%
0%
Email
Telephone
Text Message
Q: How did you primarily communicate with your last international client?
Other
Video Calls
MOST AGENTS & CLIENTS COMMUNICATE IN

ENGLISH
80%
English
11%
Chinese
6%
Spanish
4%
Other
0%
10%
20%
30%
40%
50%
Q: In which language did you primarily communicate with your last international client?
60%
70%
80%
MAJORITY AGENTS & CLIENTS

COMMUNICATE VIA SMARTPHONE
2014
2013
Smartphone
45%
54%
31%
31%
Laptop
5%
7%
Mobile phone
4%
6%
Other
3%
4%
Desktop
Tablet
2%
Landline
1%
2%
0%
4%
10%
20%
30%
40%
Q: Which technological device did you utilize the most in communicating with your last international client?
50%
60%
HALF FOUND PROPERTY IN 1 MONTH OR

LESS
50%
50%
45%
40%
35%
30%
25%
18%
20%
14%
15%
8%
7%
10%
5%
2%
2%
17-20
21-24
0%
0-4
5-8
9-12
12-16
# of Weeks
Q: How many weeks did you spend looking for a property with your last international buyer?
24-52
FEWER WEEKS SPENT LOOKING FOR

PROPERTY
Average
12
10
11.1
8.4
# of Weeks 6
4
2
0
2013
2014
Q: How many weeks did you spend looking for a property with your last international buyer?
MAJORITY VIEWED < 9 PROPERTIES

30%
24%
25%
20%
15%
13%
10%
5.1%
5%
6.6%
8.1%
9.6%
8.5%
3.7%
2.6%
5.5%
6.6%
6.6%
20-30
30-50
0%
1
6
7
# of Properties
9-15
16-20
Q: How many different properties did you view with your last international buyer prior to the client making a purchase?
FEWER PROPERTIES VIEWED IN 2014

Median
9.0
8.0
9.0
8.0
# of Properties
7.0
6.0
5.0
4.0
3.0
2.0
1.0
2013
2014
Q: How many different properties did you view with your last international buyer prior to the client making a purchase?
70% MADE MULTIPLE OFFERS
25%
20%
20%
18%
15%
11%
10%
5%
5%
6%
7%
3%
0%
1
3
4
5
Number of Other Offers
6-10
11+
Q: How many offers did your last international buyer make on other properties (in addition to the one purchased)?
FEWER OFFERS MADE IN 2014

Average
4.1
O
t
N
h
u
e
m
r
b
e
O
r
f
f
o
e
f
r
s
5
4
4
2.5
3
3
2
2
1
1
0
2013
2014
Q: How many offers did your last international buyer make on other properties (in addition to the one purchased)?
WHO ARE INTERNATIONAL

BUYERS?
Demographics
TYPICAL INTERNATIONAL BUYER
81%
Married
81%
College
Educated
74%
Male
43
Years Old
47%
Asian
$200K
Median
Income
MANY INTERNATIONAL CLIENTS FROM

CHINA
2014
2013
36%
35%
China
11%
Canada
14%
9.1%
8.3%
Mexico
UK
4.7%
3.5%
India
4.7%
3.8%
0%
5%
10%
15%
20%
25%
30%
Q: Please tell us about your last closed transaction with an international client. What is your clients country
of permanent residence?
35%
40%
CHINESE REMAINS TOP LANGUAGE AMONG

INTERNATIONAL BUYERS
Chinese
38%
English
29%
Spanish
10%
Japanese
2.9%
German
2.9%
French
2.6%
Russian
2.2%
0%
5%
10%
15%
Q: What is your last international clients primary language?

20%
25%
30%
35%
40%
MAJORITY ARE INDIVIDUALS
LLC 6%
Other
Corporation 4% 5%
Individual 84%
Q: Was your last international client a(n):

MAJORITY OF INDIVIDUAL BUYERS ARE MALE

74%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Q: What is your (last international) clients gender?

26%
INTERNATIONAL BUYERS ARE GETTING

YOUNGER
Median
45
45
43
40
35
30
A 25
g
20
e
15
10
5
0
2013
Q: What was your (last international) clients age at the time the transaction closed?
2014
MOST INTERNATIONAL BUYERS ARE

MARRIED
Other 1%
Single 18%
Married 81%
Q: What was your (last international) clients marital status at the time the transaction closed?
> 8/10 INTERNATIONAL BUYERS ARE COLLEGE

EDUCATED
46%
50%
45%
40%
35%
35%
30%
25%
20%
11%
15%
10%
5%
1%
2%
5%
0%
Grade school
or less
Some high
school
High school
Some college 4-year college
Graduate
school
Q: What is the highest level of education your (last international) client had completed at the time the transaction closed?
OCCUPATION OF INTERNATIONAL BUYERS

15%
Business/owner
12%
Engineer
11%
IT
Finance
5.0%
Doctor
5.0%
Attorney
5.0%
Teacher
4.0%
Manufacturing
4.0%
3.0%
Banker
Investor
2.0%
Developer
2.0%
0%
2%
4%
Q: What does your last international client do for a living?

6%
8%
10%
12%
14%
16%
NEARLY 1/2 INTERNATIONAL BUYERS ARE

ASIAN
E
t
h
n
i
c
i
t
y
47%
Asian
27%
White
14%
Other
Hispanic
11%
Black
1%
0%
10%
20%
30%
Q: How would you describe your (last international) clients ethnic background?
40%
50%
ANNUAL INCOME/REVENUE
$200,000
$200,000
2013
2014
$200,000
$180,000
$160,000
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$0
Q: What is your (last international) clients annual income/revenue?

STAY CONNECTED WITH RESEARCH

CARResearchGroup
CARResearchInfo
On.car.org/CARResearch
Housingmatters.car.org
JOIN US FOR OUR NEXT WEBINAR
Understanding California Home

Sellers
Thursday, February 26, 2014
2:00 PM - 3:00 PM
To register:
WWW.CAR.ORG/MARKETDATA/VIDEOS
QUESTIONS?
ThankYou!
carmenh@car.org

2014 International Home Buyer Survey

Hochgeladen von

Dokumentinformationen

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

2014 International Home Buyer Survey

Hochgeladen von

Copyright:

Verfügbare Formate

WORKING WITH

GLOBAL GDP EXPECTED TO IMPROVE

US GDP GROWTH HAS BEEN MODERATE

Q1-14 Q2-14 Q3-14

GLOBAL UNEMPLOYMENT DECLINING

US & CA UNEMPLOYMENT RATES FALLING SLOWLY

SERIES: Unemployment Rate

US & CA LABOR FORCE PARTICIPATION RATE ALSO

SERIES: Labor Force Participation Rate

GLOBAL INFLATION STEADY

SERIES: Consumer Price Index

DOLLAR VALUE RISING

SOURCE: Federal Reserve Board

FDI NET INFLOWS GROWING

Source: The World Bank

FDI IN REAL ESTATE DOWN

Source: Bureau of Economic Analysis

INTERNATIONAL HOME BUYERS IN

INTERNATIONAL PURCHASES ACCOUNT FOR 7% OF

Source: NAR 2014 Profile of International Home Buying Activity

COUNTRY OF ORIGIN OF INTERNATIONAL BUYERS

Source: NAR 2014 Profile of International Home Buying Activity

INTERNATIONAL BUYERS PREFER FL

Source: NAR 2014 Profile of International Home Buying Activity

CALIFORNIA HOUSING MARKET

CLOSED TRANSACTIONS IN THE PAST 12 MONTHS

SLIGHTLY MORE REALTORS CLOSED A TRANSACTION

# OF TRANSACTIONS CLOSED DECLINED

MAJORITY ARE BUYERS

Q: Which side did you represent?

MAJORITY BOUGHT IN SOUTHERN CALIFORNIA

TOP COUNTIES FOR INTERNATIONAL BUYERS

San Francisco / San Bernardino

MOST SALES NOT DISTRESSED

Q: What type of purchase did your last international client(s) make?

MEDIAN LISTING PRICE UNCHANGED

MEDIAN FINAL SALE PRICE: $490,000

MEDIAN FINAL SALE PRICE DROPPED 1.5%

SALE PRICE 2% LOWER THAN LIST PRICE

MAJORITY INTEND TO USE THE PROPERTY AS A

15% 20% 25% 30%

35% 40% 45% 50%

MORE BUYERS PURCHASING PROPERTIES BELOW

MORE BOUGHT CONDOS/TOWNHOMES

Residential detached SFH

Commercial office space

Q: What type of property did your last international client purchase/sell?

NEARLY HALF BOUGHT IN THE SUBURBS

Small town/rural area

MEDIAN SQUARE FEET: 1,900

Q: How many square feet did the property have?

MEDIAN SQUARE FEET 5% LOWER IN 2014

Q: How many square feet did the property have?

WHY BUY NOW?

To rent out property

Change in family status

To flip for profit

Q: What was your clients main reason for buying now?

MAJORITY ONLY CONSIDERED THE U.S.

WHY THE UNITED STATES?

To be closer to friends and family

Child attending college

Acquire legal status

MORE BUYERS PURCHASING PROPERTIES ABOVE $1M