The US property market is always attractive to international investors for many years, events occurred over the past 3 years are making it even more attractive to foreign investors. In this article, we talk about who are finding US properties especially attractive.
Canadians are always interested into US properties; they also have the language, geography and knowledge advantages. Many Canadians own at least one-vacation homes in US, especially in Florida and California. Increasingly, due to increase in property price, as well as ageing population, Canadian investors are investing in US properties both for own use and also for investment purpose. Canadian investors are also able to use the current low borrowing cost, in our case, this is at 2.2% per year, some lenders are providing funds for as low as 1.9% p.a., plus strong Canadian dollar, this makes a lot of sense for Canadian investors to get into US properties.
The trend is continuing both at individual and institutional level. Institutions have been buying up resorts, hotels, commercial and shopping malls across United States, while individual investors continue to search for their 2nd or 3rd homes. It is very important for US realtors to attract Canadian investors, either through Internet campaigns or through advertisements.
A latecomer from individual investors’ perspective, but Australian institutions was once the top 3 investors in US property markets. They are still amongst the top 10 international investors this year. Australia is facing a severe housing crisis, and it has the worst housing affordability in the western world. High borrowing cost and high property value has forced many Australians to look at offshore markets. At moment, they are very interested in US and UK property markets.
I have known many Australians whom have bought properties in Australia last 3 years, there are also smart US property companies now setting up campaigns to encourage Australian investors to US. Popular destinations include California, Florida, Colorado (for ski resorts), and Utah. There are also increasing number of Australians migrating to US, they are also buying their future homes.
Taiwanese investors are different from Chinese investors. Taiwanese investors have been very active, and sometimes dominant in US property markets. They have been especially successful in land developments in Southern California, Silicon Valley, Seattle, Portland and Texas over the past 20 years, there are now many successful Taiwanese property investors & developers residing in US.
Their demands are usually for their own use, then they will buy multiple properties, most of them would be townhomes or multi-family unites, they will then lease them out and gradually build up their portfolio in US.
Institutions have not been very active in US properties so far, but this may change. Once again, depreciation in USD has attracted more Taiwanese investors recently, many of them have families in US, and able to find properties for them.
Mainland Chinese investors take more aggressive and active approach. Their investments are often “syndicated”; they have large wealth behind them. They usually raise funds from families and friends and search for large projects. Mainland Chinese investors like to do “bulk deals”, they like to invest in a large lot of land or buy up several floors in an apartment in exchange for a deep discount in the price.
That’s how they speculate properties in China, and some have made great fortunes. Such strategy actually works in US at moment for some desperate sellers, where Chinese investors can snap up good deals. Typically they are not long-term investors, they like to sell them in a quick market possibly to other Chinese investors.
Some of the investors are actually developers, they have been looking for large projects in California, Arizona, Texas and Florida to buy up distressed assets, improve them and resell them to other international investors.
Korean investors also have a very long history in investing in US property markets, dated back to the 1980s. Korean individual investors are highly active in US, although, their geographical spread tends to be different from other Asian investors. Many Korean families also prefer to live in areas near their churches, the Korean churches in US is another active investor in the US market on its own.
Korean investors are currently concentrated in major cities such as Los Angeles, San Francisco, Boston and Chicago. Atlanta and Charlotte have been 2 areas that Korean investors have been expanding recently, especially Atlanta, which includes both commercial and residential investment activities.
A good way to start marketing your properties to ethnic groups and international investors is through Internet, many of these investors do not use English language websites, have your information in their language will increase your visibility and opportunities.
Also, engage with property marketing groups that specializes in translation, marketing, and work with local communities and immigration agents will also help.