Cash-paying foreign investors dominate weak U.S. housing market amid affordability concerns

A surge of international buyers, mainly from China, have picked up homes in the U.S. over the past year as U.S. households continue to face mounting challenges in the market.

The number of existing homes purchased by foreign buyers from April 2024 to March 2025 increased for the first time since 2017, according to a recent report from the National Association of Realtors (NAR). The report highlights that Chinese buyers represented the largest portion of foreign investors in terms of total spending and transaction volume, purchasing $13.7 billion worth of existing homes – an 83% increase from the prior year.

That is a significant uptick from the $7.5 billion worth of purchases in the prior year, according to NAR. These buyers also have the highest average purchase price at $1.2 million, with the majority of purchases being concentrated in states with hefty price tags. For instance, about 36% of Chinese buyers purchased a property in California, while 9% purchased property in New York, according to the report.  

The persisting U.S. housing affordability crisis, which has been making it particularly hard for American buyers and sellers to enter the market, is creating more opportunities for overseas buyers, according to real estate experts.

HOUSING CRISIS DEEPENS AS 47 MAJOR METRO AREAS NOW REQUIRE HOMEBUYERS TO SPEND MORE THAN 30% OF INCOME

Roughly 78,100 properties were purchased by foreign buyers, representing a 44% increase from the prior year, though it is still the second-lowest level since NAR began estimating foreign buyer purchases in 2009.

While foreign buyers aren’t necessarily edging out American buyers, they are capitalizing on the weak demand in the market as mortgage rates remain one of the biggest barriers to entry for U.S. buyers and sellers, according to Realtor.com senior economist Joel Berner. 

Real estate experts say the housing affordability crisis in the U.S. is creating more opportunities for overseas buyers. (Steve Pfost/Newsday RM via Getty Images) / Getty Images)

“If you look in that NAR report, over half of these international buyers are making cash purchases, because they can. They’re wealthy international folks who are looking at the market in the U.S. right now and seeing there’s not a lot of demand for homes in the U.S.,” Berner said, adding that American buyers are content to sit on the sidelines right now because of affordability issues. 

AMERICA’S HOUSING CRISIS: REALTOR.COM CEO SAYS THERE IS A WAY TO SOLVE IT

The average rate on a 30-year fixed mortgage is 6.67%, according to mortgage buyer Freddie Mac. That’s more than double the roughly 3% rate seen in December 2021, highlighting the growing pressure Americans face with borrowing costs.

While foreign buyers aren’t necessarily edging out American buyers, they are capitalizing on the weak demand in the market. (SAUL LOEB/AFP via Getty Images) / Getty Images)

On top of that, home prices are hitting record highs. Nationwide, prices have risen nearly 4% year over year and a staggering 60% since 2019, according to the Joint Center for Housing Studies’ State of the Nation’s Housing report. In turn, it drove the cost of a typical existing single-family home to a record $412,000 in 2024. 

However, if paying in cash, experts say it is a good time to buy, regardless if it is an international or American buyer, given that they are skirting those high borrowing rates. 

GET FOX BUSINESS ON THE GO BY CLICKING HERE

Berner said the interest from international buyers is a welcome relief to certain sellers amid slow sales activity. 

“It’s helping to kind of eat up some of the inventory that would otherwise go unsold,” Berner said, adding that Realtor.com has seen a rise in delisting activity because “people are just kind of giving up on selling their home.” 

One expert told FOX Business that interest from international buyers is a welcome relief to certain sellers amid slow sales activity. (David Paul Morris/Bloomberg via Getty Images / Getty Images)

Delistings outpaced overall inventory gains in May, jumping 35% year to date and 47% year over year, according to Realtor.com’s June report. Comparatively, active listing growth was 28.4% and 31.5%, respectively.