whitehorse real estate,real estate in whitehorse,whitehorse houses for sale whitehorse real estate,real estate in whitehorse,whitehorse houses for sale whitehorse real estate,real estate in whitehorse,whitehorse houses for sale whitehorse real estate,real estate in whitehorse,whitehorse houses for sale

Canadians and Russians Penetrate U.S. Housing Market

Ever since the U.S. housing bubble burst, it’s no surprise that foreign buyers have flooded the U.S. housing market. Both the Canadians and the Russians are leading the pack, but in different ways.

“Canadians tend to be very value oriented,” says Jed Smith, managing director, quantitative research for the National Association of Realtors. ”The buyers are generally not wealthy, although obviously they can afford a second property. In contrast, Russian buyers are believed to be more affluent and looking for upscale, expensive properties. They are generally seeking properties that establish a presence or image.”

According to a survey by the National Association of Realtors, foreign buyers accounted for $82.5 billion, or 8.9 percent, of the $928 billion spent on U.S. residential real estate from April 2011 through March 2012. Foreign investment in real estate has helped the U.S. housing recovery tremendously since the crash, and Canada being a top investor in the U.S. market, is leading the way in aiding this recovery.

Besides Canada, who else is buying?

The “BRIC countries” — Brazil, Russia, India and China — are the fastest growing and largest emerging market economies in the world to date. Today’s low prices and the potential for appreciation make U.S. properties particularly attractive to the BRICs, as does political stability. BRIC countries combined account for 22% of the foreign buying activity in the U.S. and Canadians account for 24%. Even though Russia only accounts for 2% of the buying activity they’re attracting a lot of attention.

In Russia, the nation’s 80 billionaires account for 7 percent of the total population of people with a net worth of $30 million or more, but they own 84 percent of that group’s $640 billion in wealth.

There is much publicity around Russia and other BRIC countries because they are showing the fastest global growth in billionaires.

Unlikely companions in the U.S. housing market

Flashy Russians are headlining international news with stratospheric real estate purchases by self-made billionaires, while understated Canadians quietly buy 12 times the volume.

What Russians are lacking in quantity, they’re making up for in high priced trophy properties in the U.S. Conversely, Canadians have been a dominant purchasing force in states like Arizona and Florida. Canadians see an opportunity to scoop up a home that could be used for vacations now and retirement later, as opposed to spending record breaking amounts on the most opulent real estate the U.S. has to offer.

The Canadians

Buyers from Canada tend to be more diverse, representing a wider range of income and have been cited as searching for homes from the lowest to the highest ends of the market.

About 24 percent of foreign buyers in the U.S. are Canadians, making them the largest share nationally, according to the latest report by the National Association of Realtors.

According to Realtor.com, Canadians account for the most international search activity on the listing site every month in nearly all of major U.S. metro areas.

According to a report by Florida Realtors, a statewide trade group, from July 2011 to June 2012, Canadians accounted for 19 percent of total home sales in Florida. In that year, sales to non U.S. residents reached an estimated $10.7 billion, out of a total of $58 billion. Canadians accounted for 31 percent of these foreign purchases, putting them in the top spot. In comparison, Russians only made up 2 percent of the sales.

Bob Krawitz of RE/MAX Signature in Chicago says that Canadians have also been buying up properties in the mid-western U.S., “The close proximity to Canada makes it an easy place for Canadians to invest money.” Interest runs along all price points, from properties that can be fixed up and rented out to seven-figure mansions.

So Canadians may be interested in buying a $2 million pied-a-terre or a less expensive winter residence, but are they willing to make eight digit real estate investments in the U.S.?