Canadians leading foreign buyers in U.S. real estate market

Canada has surpassed China as the leading buyer of real estate in the United States when it comes to foreign buyers, a new report has found.

A recent report from RBC revealed that Canada leads all out-of-country buyers in the U.S. amid the slowest period for foreign buyer activity in the past 15 years.

The report author cited National Association of Realtors’ annual survey, which revealed transactions involving international clients totalled $42 billion from April 2023 to March this year, a decrease of 21 per cent year over year. All told, foreigners were involved in 54,000 purchases, down 37 per cent compared with the same period the year before.

RBC noted that high inflation, limited inventory and higher borrowing costs have all helped tamp down demand among buyers, including foreign ones.

Canadians, however, were an outlier group with an increase in activity, accounting for about 13 per cent of purchases, versus 11 per cent among Chinese, Indian and Mexican buyers.

By total dollar value, Chinese buyers topped other foreign purchasers. They made up about $7.5 billion in sales volume while Canadians accounted for $5.9 billion.

All the activity occurred amid a rising U.S. dollar, which reduced many foreign buyers’ purchasing power, the study pointed out.

Yet Canadians saw the least depreciation in currency. The Canadian dollar was down 3.6 per cent, versus 9.4 per cent for Chinese yuan, the report stated.

The difference in the average price of a home also likely helped offset currency headwinds for Canadians, especially in the nation’s largest markets where prices are generally higher than even the U.S.’s top urban markets.

On this point, the report further noted that the price per square metre in Toronto in June 2024 was $12,504 versus highly desirable markets like Los Angeles at $4,760 or Honolulu at $6,280.