Mexicans overtake brits in us market
Property prices have taken a well-documented dive in sunny US holiday hotspots such as Florida. But that hasn't encouraged many Brits back into the US homebuying market - in fact, the British have fallen behind Mexicans in the ranks of foreign property buyers in the US.
The National Association of Realtors' annual study says the British accounted for 9% of overseas property purchases in the US during the year to March - a fall from 10.5% the previous year.
That means Britain dropped from second to third place in terms of foreign homebuyers in the US, behind Mexico which accounted for 10% of purchasers. And if present trends continue, British buyers will soon be overtaken by the Chinese, who are only a whisker behind. Canada is easily top of the table, accounting for 23% of international home purchases.
No doubt the weak British economy is largely to blame. There aren't too many people who feel affluent enough to splash out on a holiday home just at the moment. In the wake of America's subprime mortgage fiasco, it's also become much harder to get a homeloan as an overseas buyer - banks such as Lloyds TSB and Bank of America used to offer easy-to-access capital. Deals with low deposits are now off the table and buyers often have to stump up 30% in cash. The NAR found that 34% of foreign buyers had been unable to complete purchases because of financing problems.
Average prices across the US continue to fall - the median amount paid by an international buyer dropped from $247,100 to $219,400, pushed down by a glut of bank-owned foreclosed property. Yet the total value of foreign purchases rose from $39bn to $41bn.
By far the most popular US state for British buyers is Florida - and when I visited the Orlando area back in March, gloomy stories were in abundance about negative equity and plummeting home values. In the hinterland of Disneyworld, a local British pub, Harry Ramsbottom's, was up for sale due to a lack of UK business. Perhaps it'll be replaced by a Mexican tequileria.
Source: www.guardian.co.uk