Foreign Buyers Retreat: International Home Purchases in US Drop 19% to $45.3bn
A sudden slowdown in foreign demand for real estate USA
Foreign interest in U.S. housing cooled sharply between April 2025 and March 2026. According to the National Association of Realtors’ (NAR) 2026 International Transactions in U.S. Residential Real Estate report, foreign buyers purchased $45.3 billion in existing homes over the 12‑month period — a 19.1% decline in dollar volume and a 14% fall in unit sales compared with the prior year. That is not a rounding error. It is a meaningful contraction in a market niche that was already small.
This matters for buyers and investors because foreign purchases concentrate in high‑demand coastal and Sun Belt markets and are disproportionately paid in cash. Even though foreign buyers account for only a sliver of overall activity, their moves can tilt competition at the top end.
What the numbers say in plain terms
- 67,100 existing homes were purchased by foreign buyers during the 12 months, down from 78,100 a year earlier. That is the second‑lowest count since NAR began tracking the segment in 2009.
- Foreign purchases were 1.7% of roughly 4.07 million existing‑home sales and 2.0% of the estimated $2.3 trillion in sales volume.
- The median purchase price for foreign buyers was $465,000, compared with $413,600 for all existing‑home buyers. The average foreign purchase price was about $669,500, down 6.9% year over year.
- Nearly 48% of foreign purchases were paid in cash, versus 28% for all buyers.
These figures come from a NAR survey of 4,970 Realtors conducted in April 2026. Only 381 respondents reported at least one international residential buyer, which underscores how narrow the slice of the market is.
Who are the foreign buyers? Resident vs non‑resident split
NAR separates foreign buyers into two groups: residents (Type B) and non‑resident buyers (Type A). The split matters for how those purchases affect local markets.
- Resident foreign buyers — recent immigrants and non‑immigrant visa holders who live in the U.S. — accounted for 37,600 purchases (56%) and about $21.8 billion in volume.
- Non‑resident buyers — people whose primary residence remains abroad — bought 29,500 homes (44%) and accounted for $23.5 billion in volume.
Non‑residents bought fewer properties but spent more per transaction on average. That points to a pattern we already see on the ground: foreign purchasers who keep a home primarily abroad often seek higher‑priced properties in prime markets.
I find the split revealing. Resident foreign buyers behave more like domestic purchasers — they are house‑hunters who want to live and work in the U.S. Non‑resident buyers are more likely to buy second homes or investment properties, and their purchasing profile is heavier at the top of the price scale.
Where foreign dollars went: a concentrated picture
Foreign demand remained highly concentrated in a handful of states:
- Florida drew 20% of foreign buyers, led by resort and retirement markets.
- California attracted 19%, reflecting high prices and gateway cities.
- Texas picked up 12%, a notable share given its large geographic and price diversity.
- New Jersey and Georgia each drew 4% of foreign buyers.
Concentration matters because a 1–2 percentage‑point change in foreign buyer activity can be felt strongly in certain metro areas. In markets where foreign buyers are concentrated, slower international demand can temper bidding pressure and reduce cash competition.
Who’s buying: country breakdown and spending patterns
By number of transactions, the top origins were:
- Canada: 16% of foreign buyers (~10,700 homes). Canada regained the top spot by unit count.
- Mexico: 14% (~9,400 homes).
- China (mainland China, Hong Kong and Taiwan): 11% (~7,400 homes).
- India: 9%.
- United Kingdom: 4%.
By dollar volume, Chinese buyers remained the largest source, spending $7.6 billion. That reflects an average purchase near $1 million and a heavy tilt into expensive markets such as California and New York. India accounted for $3.7 billion and the U.K. about $1.2 billion. The top five origin countries accounted for roughly half of foreign‑buyer dollar volume.
This split shows a key point: units purchased and dollars spent tell different stories. Buyers from Canada and Mexico are numerous but tend to buy lower‑priced properties relative to buyers from China, who contribute far more to volume despite fewer transactions.
Why the pullback?
NAR Chief Economist Lawrence Yun said the pullback mirrors a slowdown in international visitors to the United States. The report notes that a slightly weaker U.S. dollar over the past year — which should raise foreign purchasing power in theory — “did not induce more activity.”
A few pragmatic reasons help explain the decline:
- Reduced international travel limits the number of buyers who can tour properties in person, and in many international transactions in the U.S. physical visits still matter.
- Higher mortgage borrowing costs and tight inventory pushed many buyers toward lower price points; NAR recorded an average foreign purchase price decline of 6.9% year over year.
- Local market dynamics and regulatory changes in certain source countries can slow outbound investment.
I would add that the bank lending environment for foreign nationals and cross‑border capital controls in some countries are not reflected in headline numbers but can shape transaction flows. The data in the NAR report point to a mix of supply, demand and mobility factors rather than a single cause.
What this means for domestic buyers, investors and policymakers
From the standpoint of someone buying, selling or investing, the shift in foreign activity changes the competitive picture in certain markets but not the market as a whole.
Key takeaways for different groups:
- For buyers competing in Florida or California: foreign cash buyers still matter. 48% of foreign purchases were all cash, which keeps pressure on listings where international interest is concentrated.
- For sellers in gateway and resort markets: a decline in foreign activity can lengthen the time on market for high‑end properties and reduce the pool of cash buyers.
- For local investors and developers: a drop in international demand may reduce bidding wars at the top end and create buying opportunities if fundamentals hold.
- For policymakers and housing planners: foreign buyers are a small part of the overall market — 1.7% of existing sales — but they influence luxury and resort sectors where housing affordability and land use policy have outsized local impact.
We should be careful about reading these numbers as a sign that the broader housing market is weaker. Foreign demand fluctuates with travel, exchange rates and geopolitical shifts. Domestic credit conditions, wage growth and supply remain the main drivers of the U.S. housing market overall.
Investment implications and practical strategies
If you are a foreign buyer considering real estate USA or a domestic investor watching cross‑border flows, here are practical approaches based on what the NAR data show:
- Expect cash competition in the markets that foreign buyers favor — Florida, California and Toronto? Sorry, Texas — Texas too. If you are bidding in these markets, be ready to show proof of funds or have financing pre‑approved.
- If you are a non‑resident buyer, budget for higher per‑transaction costs; non‑residents spent more per purchase on average than resident foreign buyers.
- Watch for micro‑opportunities in markets where foreign buyer share is concentrated. A pullback that reduces the number of cash offers can be a chance for financed buyers to win contracts with conventional financing.
- For investors seeking rental yield, prioritize fundamentals over hoping for a return of foreign buyers. Rental demand and local job growth are the durable drivers of performance.
Risks and what to watch next
The NAR report is a snapshot covering a period that ended in March 2026. It highlights a contraction in one market segment, but early indicators to monitor include:
- Trends in international travel to the U.S., since fewer visitors reduce buyer pipelines.
- Exchange‑rate movements: a materially stronger dollar would erode foreign purchasing power, while further weakening may or may not stimulate interest as the NAR report suggests.
- Lending conditions for foreign nationals, both in the U.S. and in source countries.
- Policy changes affecting property purchases by non‑residents in major source countries.
Risks for investors include over‑reliance on foreign buyers in a niche market, and misreading a temporary slowdown as a structural shift when it could be cyclical.
My assessment: concentrated decline, real effects in some markets
The headline 19.1% drop in foreign buyer dollar volume is striking, but it is not a market‑wide crisis. Foreign buyers are a small slice of total existing‑home sales, yet they are concentrated in certain states and price tiers where they have outsized impact. A nearly half share of cash transactions among foreign buyers keeps them relevant in competitive markets.
We should treat the NAR numbers as a reminder that global factors — travel, currency moves, international wealth flows — interface with local housing markets. For many domestic buyers and investors, the most immediate implication is that cash competition in places like Florida and California may have eased a little, but caution is still warranted when evaluating high‑end listings.
Quick checklist for market participants
- Sellers in gateway markets: expect slightly fewer foreign cash bids; price defensively around comparable sales.
- Domestic buyers: gather financing documents and be prepared to respond quickly in areas where foreign cash remains a factor.
- Investors: stress‑test deals for longer holding periods if foreign exit demand softens.
- Policymakers: continue to monitor local housing impacts rather than national volume alone.
Frequently Asked Questions
Q: How big is foreign buying in the U.S. housing market?
A: Foreign buyers purchased 67,100 existing homes from April 2025 to March 2026, which is 1.7% of roughly 4.07 million existing‑home sales and 2.0% of an estimated $2.3 trillion in sales volume.
Q: Which countries account for the most foreign purchases?
A: By unit count, Canada (16%) and Mexico (14%) led the way. By dollar volume, buyers from China were the largest source, spending $7.6 billion with an average purchase near $1 million.
Q: Are foreign buyers mostly paying cash?
A: Almost half of foreign purchases are paid in cash — 48% — far above the 28% share for all existing‑home buyers. That cash profile matters in competitive listings.
Q: Which U.S. states attract the most foreign buyers?
A: Florida (20%), California (19%), and Texas (12%) were the top destinations for foreign buyers in the report period.
If you are an investor or buyer, remember this simple calculus: foreign buyers are fewer but still influential where they concentrate, and the immediate effect of their retreat is most visible in high‑end coastal and resort markets.
Tags
We will find property in USA for you
- 🔸 Reliable new buildings and ready-made apartments
- 🔸 Without commissions and intermediaries
- 🔸 Online display and remote transaction
International Real Estate Consultant
Subscribe to the newsletter from Hatamatata.com!
Subscribe to the newsletter from Hatamatata.com!
Popular Posts
We will find property in USA for you
- 🔸 Reliable new buildings and ready-made apartments
- 🔸 Without commissions and intermediaries
- 🔸 Online display and remote transaction
International Real Estate Consultant
Subscribe to the newsletter from Hatamatata.com!
Subscribe to the newsletter from Hatamatata.com!
I agree to the processing of personal data and confidentiality rules of HatamatataPopular Offers
1
0
2
2
80
4
4
166
Need advice on your situation?
Get a free consultation on purchasing real estate overseas. We’ll discuss your goals, suggest the best strategies and countries, and explain how to complete the purchase step by step. You’ll get clear answers to all your questions about buying, investing, and relocating abroad.
Sales Director, HataMatata