Located in the sunny climate of Southern California and having the international influence of a world-class city, Los Angeles has always been a hotbed of luxury real estate for foreign investors. As the city innovates and improves on itself, the element of wealthy, international home buyers has not lessened, but rather strengthened as Los Angeles is priming itself to become the premier destination and eventual home for some of the world’s richest home hunters.
According to the National Association of REALTORS®, buyers hailing from overseas and new immigrants to the U.S. accounted for approximately $92 billion in home sales in the year ending in March. This is up 35 percent from the previous 12-month period and sets a new record after 2012’s high value of $82.5 billion in home sales. Across the board, international buyers are now making up roughly 7 percent of U.S. home sales based on monetary value.
A main driver behind the jump in foreign investor activity may be the faltering real estate market occurring in China right now, as many of the investors coming to the U.S., and Southern California in particular, hail from China. This year saw a 50 percent jump in activity from Chinese buyers, who made up a majority of the foreign investor activity with $22 billion worth of U.S. home sales.
In addition to being a safe place to stash cash and equity, another factor that has been drawing investors to the U.S. from all over the world is the school system. Many are buying homes in order to have the privilege of putting their children in U.S. schools.
Luxury Real Estate in Southern California Attracting Worldly Buyers
In addition to massive amounts of money that these foreign buyers are pumping into the U.S. real estate market, NAR also found that Southern California was the top region that these buyers are gravitating toward. Los Angeles was ranked the No. 1 destination, while Irving rang in at No. 3. San Francisco split the two Southern California cities, rounding out the top three with a strong showing for California real estate.
While Chinese investors were found to be the most popular in the region, other nationalities are making their mark in Los Angeles as well. According to data from Realtor.com, which tracked its searches for demographic data, buyers from India, the United Kingdom, Australia, Ireland and Russia were all found to have an extreme interest in the region.
Not surprisingly based on its geographical location, San Diego was found to be popular with buyers from Mexico.
“We live in an international marketplace, so while all real estate is local, that does not mean that all property buyers are,” said NAR President Steve Brown. “Foreign buyers are being enticed to U.S. real estate because of what they recognize as attractive prices, economic stability and an incredible opportunity for investment in their future.”
Los Angeles is a wonderfully diverse community that has a lot to offer luxury buyers of all walks of life. If you are interested in Los Angeles luxury homes, please contact our team of property experts today.