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Foreign Buyers’ Desire for U.S. Real Estate Continues to Grow

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Real Estate in the United States continues to be a choice investment for international buyers.  In fact, the number of homes purchased by foreign buyers rose 2.8 percent from April 2015 to March 2016.Business concept isolated on white

There has, however, been a shift in the types of properties and locations these buyers are opting to purchase.   Reported numbers reflect a decline in foreign non-resident investors, who typically purchase properties in expensive markets such as San Francisco and New York City.  Nevertheless, a rise in the number of recent immigrant foreigners purchasing homes helped to increase the overall dollar volume to the second highest in the past 7 years.  Both groups of foreign buyers, whether looking for an investment or for a home to live in, are opting for smaller properties in less expensive parts of the U.S.

More positive news for U.S. real estate is detailed in an article published by CNBC.com by Diana Olick.  With the recent global financial market instability, investors see real estate as very safe investment.  Lawrence Yun, chief economist of the National Association of Realtors (NAR), indicated, “… with economic instability and political turmoil outside of the U.S. likely to persist, the world view of American real estate as a safe investment should keep demand firm …”

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Photo Credit: Seneca Real Estate

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Weak Economic Data Means Good News for Mortgage Rates

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MINOLTA DIGITAL CAMERAMortgage rates have retreated again in response to weak financial data and global economic concerns, according to a report released Thursday by the Federal Home Loan Mortgage Corp.   Specifically, the average 30 –year mortgage rate dropped to 3.6 percent.  In fact, mortgage rates have not been above 3.7 percent in the past 10 weeks.  This streak has allowed home buyers more time to take advantage of these historically low mortgage rates.  Consequently, loan application volume increased 9.3 percent from the previous week.

The drop in the mortgage rates is a direct result of a weak jobs report, which was released last Friday.    “Growing optimism about the state of the economy was quickly erased with May’s employment report,” Sean Becketti, Freddie Mac chief economist, said in a statement.  The article published in The Washington Post, by Kathy Orton, also details some of the global economic concerns which have had an effect on the direction of mortgage rates.

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