california's housing market outlook 2015
TRANSCRIPT
CALIFORNIA’S HOUSING MARKET OUTLOOK 2015
February 27, 2015
California Community Colleges REEC Conference
Sara Sutachan, Manager of Broker and Real Estate Finance Outreach
OVERVIEW
• Economic Outlook
• California Housing Market Outlook
• Housing Affordability and Homeownership
• 2015 Forecast
ECONOMIC OUTLOOK
ECONOMIC FUNDAMENTALS ARE BETTER
• Economic growth strong
• Unemployment rate 5.9% - lowest since ?
• Best employment growth since 1999, 3 million new jobs
• Construction jobs +230,000 in last 12 months
• Uncertainty from abroad, yet again
-4%
-3%
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
Q1-
10
Q2
-10
Q3-
10
Q4
-10
Q1-
11
Q2
-11
Q3-
11
Q4
-11
Q1-
12
Q2
-12
Q3-
12
Q4
-12
Q1-
13
Q2
-13
Q3-
13
Q4
-13
Q1-
14
Q2
-14
Q3-
14
Q4
-14
GROSS DOMESTIC PRODUCT
2013: 1.9% 2014: 2.4%; 2014 Q4: 2.6%
ANNUAL PERCENT CHANGE, CHAIN-TYPE (2005) $
ANNUALLY QUARTERLY
2009 Largest Annual Drop since 1938 (-3.4%)
SERIES: GDPSOURCE: US Dept. of Commerce, Bureau of Economic Analysis
SERIES: Components of GDPSOURCE: US Dept. of Commerce, Bureau of Economic Analysis
COMPONENTS OF GDP: CONSUMPTION
-4.0
-3.0
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
20
00
Q1
20
00
Q3
20
01
Q1
20
01
Q3
20
02
Q1
20
02
Q3
20
03
Q1
20
03
Q3
20
04
Q1
20
04
Q3
20
05
Q1
20
05
Q3
20
06
Q1
20
06
Q3
20
07
Q1
20
07
Q3
20
08
Q1
20
08
Q3
20
09
Q1
20
09
Q3
20
10 Q
1
20
10 Q
3
20
11 Q
1
20
11 Q
3
20
12 Q
1
20
12 Q
3
20
13 Q
1
20
13 Q
3
20
14 Q
1
20
14 Q
3
ANNUAL PERCENT CHANGE
CONSUMER CONFIDENCE – 7 YEAR HIGH
January 2015: 102.9
0
20
40
60
80
100
120
Jan
-05
Jul-
05
Jan
-06
Jul-
06
Jan
-07
Jul-
07
Jan
-08
Jul-
08
Jan
-09
Jul-
09
Jan
-10
Jul-
10
Jan
-11
Jul-
11
Jan
-12
Jul-
12
Jan
-13
Jul-
13
Jan
-14
Jul-
14
Jan
-15
INDEX, 100=1985
SERIES: Consumer ConfidenceSOURCE: The Conference Board
UNEMPLOYMENT RATE FALLING
December 2014: US 5.6% & CA 7.2%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
14% US-CA CA US
SERIES: Unemployment RateSOURCE: US Bureau of Labor Statistics, CA Employment Development Division
2007-2010 LOST JOBS REPLACED: JAN 2014
-8
-6
-4
-2
0
2
4 California US
ANNUAL PERCENT CHANGE
SERIES: Total Nonfarm EmploymentSOURCE: US Bureau of Labor Statistics, CA Employment Development Division
JOB LOSSES IN PRIOR RECESSIONS -RECENT CYCLE WORST BY FAR
NONFARM EMPLOYMENT BY REGION
Dec 2014 Dec 2013 Change % Change
Southern California 8,741.4 8,562.3 179.1 2.1%
Bay Area 4,263.0 4,192.4 70.6 1.7%
Central Valley 1,515.3 1,481.8 33.5 2.3%
Central Coast 1,289.7 1,265.0 24.7 2.0%
North Central 1,376.1 1,331.6 44.5 3.3%
CALIFORNIA 297.3 291.5 5.8 2.0%
Nonfarm Employment (Thousands)
SERIES: Total Nonfarm EmploymentSOURCE: CA Employment Development Division
CA JOB TRENDS – BAY AREA LEADS
1.5%
1.5%
1.7%
2.0%
2.0%
2.2%
2.3%
2.4%
2.7%
3.3%
3.7%
4.0%
0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5%
Modesto
Bakersfield
Los Angeles
Ventura
Sacramento
Stockton MSA
Orange County
Oakland
Fresno MSA
San Diego
San Francisco
San Jose
SERIES: Total Nonfarm Employment SOURCE: CA Employment Development Division
ANNUAL PERCENT CHANGE
December 2014: CA +2.1%, +320,300
CONSTRUCTION WORKERS IN DEMAND
-1.0%
-0.5%
-0.1%
0.7%
0.9%
1.4%
1.9%
2.7%
2.9%
2.9%
3.4%
3.6%
4.3%
6.2%
6.4%
-2% -1% 0% 1% 2% 3% 4% 5% 6% 7%
Nondurable GoodsFinance & Insurance
GovernmentDurable Goods
Retail TradeTransportation, Warehousing & Utilities
Real Estate & Rental & LeasingWholesale Trade
Educational ServicesInformation
Leisure & HospitalityHealth Care & Social Assistance
Professional, Scientific & Technical ServicesAdmistrative & Support & Waste Services
Construction
SERIES: Total Nonfarm Employment By IndustrySOURCE: US Bureau of Labor Statistics, CA Employment Development Division
November 2014: CA +2.2%, +344,100;
250K new construction jobs in next 5 years
ANNUAL PERCENT CHANGE
FINANCING ENVIRONMENT
MORTGAGE RATES
January 2009 – December 2014
0%
1%
2%
3%
4%
5%
6%
20
09
/01
20
09
/04
20
09
/07
20
09
/10
20
10/0
1
20
10/0
4
20
10/0
7
20
10/1
0
20
11/0
1
20
11/0
4
20
11/0
7
20
11/1
0
20
12/0
1
20
12/0
4
20
12/0
7
20
12/1
0
20
13/0
1
20
13/0
4
20
13/0
7
20
13/1
0
20
14/0
1
20
14/0
4
20
14/0
7
20
14/1
0
11.0
6.1
4
11.2
7.14
12.1
8.1
4
FRM
ARM
MONTHLY WEEKLY
SERIES: 30Yr FRM, 1Yr ARMSOURCE: Federal Home Loan Mortgage Corporation
IS THERE A FORECAST BIAS FOR RISING RATES?
Percent
0
1
2
3
4
5
6
0
1
2
3
4
5
6
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Actual 10-year Treasury yield (solid black line)
Predictions out to five quarters ahead of professional forecasters (hatched lines)
Percent
SERIES: Loan Officer SurveySOURCE: Philadelphia Federal Reserve Survey of Professional Forecasters, Bloomberg
CREDIT AVAILABILITY UP VERYSLIGHTLY
HOUSING CREDIT INDEX
LOOSENED CREDIT REQUIREMENTS:
FICO Scores Trending Down Since 2012
SERIES: Average FICO Score on Closed LoansSOURCE: Ellie Mae
710
720
730
740
750
760
C.A.R. LENDERPERFORMANCE INDEX
LENDER PERFORMANCE IMPROVING
3133
41
56
66
0
10
20
30
40
50
60
70
2010 2011 2012 2013 2014
SOURCE: California Association of REALTORS®
LENDER SATISFACTION HAS IMPROVED SIGNIFICANTLY OVER THE PAST FOUR YEARS
1 2 3 4 5
The timeliness of responses to your inquiries
Knowledge/professionalism of therepresentative you worked with
Length of time to obtain approval/disapprovalof the short sale transaction
Expectations of financial contributions fromthe seller at or after closing
Timeliness of buyer's financing approval
Your overall satisfaction with this lender
3.74
3.92
3.5
3.7
3.64
3.71
3.30
3.57
2.92
3.39
3.42
3.23
2.80
3.10
2.38
3.09
2.73
2011
2012
2013
2014
Very Dissatisfied Very Satisfied
SOURCE: California Association of REALTORS®
EASE OF CLOSING
0% 10% 20% 30% 40% 50%
1
2
3
4
5
27%
23%
11%
19%
20%
16%
18%
10%
28%
27%
12%
13%
15%
28%
31%
8%
11%
13%
19%
49%
2011
2012
2013
2014
Extremely Easy
Extremely Difficult
SOURCE: California Association of REALTORS®
UNDERWRITING STANDARDS INDEX
17
23
0
5
10
15
20
25
2013 2014
SOURCE: California Association of REALTORS®
UNDERWRITING STANDARDS SLIGHTLY BETTER
49%41%
35%45%
16% 14%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2013 2014
Easier(access tocrediteasier forclients)
No changefrom 12monthsago
Tighter(access tocreditharder forclients)
SOURCE: California Association of REALTORS®
U.S. ECONOMIC OUTLOOK 2014 - 2015
2009 2010 2011 2012 2013 2014p 2015f
US GDP -3.4% 2.4% 1.8% 2.8% 1.9% 2.5% 3.0%
Nonfarm Job Growth -4.4% -0.7% 1.2% 1.7% 1.7% 2.0% 2.3%
Unemployment 9.3% 9.6% 8.9% 8.1% 7.4% 6.2% 5.6%
CPI -0.4% 1.6% 3.1% 2.1% 1.5% 1.5% 1.6%
Real Disposable
Income, % Change 0.9% 1.8% 1.3% 1.5% 0.7% 2.4% 2.4%
SERIES: U.S. Economic OutlookSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
CALIFORNIA ECONOMIC FORECAST
SERIES: CA Economic OutlookSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
Nonfarm Job Growth
Unemployment Rate
Population Growth
Real Disposable Income, % Change
2011
1.1%
11.8%
0.7%
1.9%
2012
2.4%
10.4%
0.7%
1.1%
2013
3.0%
8.9%
0.9%
0.9%
2014 P
2.2%
7.5%
0.9%
3.0%
2015 F
2.4%
6.7%
0.9%
3.8%
CALIFORNIA HOUSING MARKET OUTLOOK
CA HOME SALES DOWN 7.6% IN 2014
California, Jan. 2015 Sales: 351,890 Units, -2.7% YTD, -2.7% YTY
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
Jan
-05
Jul-
05
Jan
-06
Jul-
06
Jan
-07
Jul-
07
Jan
-08
Jul-
08
Jan
-09
Jul-
09
Jan
-10
Jul-
10
Jan
-11
Jul-
11
Jan
-12
Jul-
12
Jan
-13
Jul-
13
Jan
-14
Jul-
14
Jan
-15
*Sales are seasonally adjusted and annualized SERIES: Sales of Existing Single Family HomesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
Jan-15: 351,890
Jan-14: 361,790
SHARE OF EQUITY SALES REMAINED STEADY AT THE HIGHEST LEVEL SINCE LATE 2007
90.5%
4.8%
4.3%0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Jan
-09
Ap
r-0
9
Jul-
09
Oct
-09
Jan
-10
Ap
r-10
Jul-
10
Oct
-10
Jan
-11
Ap
r-11
Jul-
11
Oct
-11
Jan
-12
Ap
r-12
Jul-
12
Oct
-12
Jan
-13
Ap
r-13
Jul-
13
Oct
-13
Jan
-14
Ap
r-14
Jul-
14
Oct
-14
Equity Sales Short Sale REO
SERIES: Distressed Sales, Not Seasonally AdjustedSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
LOS ANGELES COUNTY
Preforeclosure: 4,899 • Auction: 4,098 • Bank Owned: 937
SOURCE: PropertyRadar on 02/05/15
LOS ANGELES COUNTY
Preforeclosure: 4,899 • Auction: 4,098 • Bank Owned: 937
SOURCE: PropertyRadar on 02/05/15
LOS ANGELES COUNTY
Preforeclosure: 4,899 • Auction: 4,098 • Bank Owned: 937
SOURCE: PropertyRadar on 02/05/15
SAN BERNARDINO COUNTY
Preforeclosure: 1,595 • Auction: 1,017 • Bank Owned: 613
SOURCE: PropertyRadar on 02/23/15
SAN BERNARDINO COUNTY
Preforeclosure: 1,595 • Auction: 1,017 • Bank Owned: 613
SOURCE: PropertyRadar on 02/23/15
SAN BERNARDINO COUNTY
Preforeclosure: 1,595 • Auction: 1,017 • Bank Owned: 613
SOURCE: PropertyRadar on 02/23/15
MEDIAN PRICE OF EXISTING DETACHED HOMES
California, Jan. 2015: $426,790, -5.9% MTM, +3.4% YTY
$-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
Jan
-05
Jul-
05
Jan
-06
Jul-
06
Jan
-07
Jul-
07
Jan
-08
Jul-
08
Jan
-09
Jul-
09
Jan
-10
Jul-
10
Jan
-11
Jul-
11
Jan
-12
Jul-
12
Jan
-13
Jul-
13
Jan
-14
Jul-
14
Jan
-15
P: May-07$594,530
T: Feb-09$245,230-59% frompeak
SERIES: Median Price of Existing Single Family HomesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
Jan-15: $426,790
Jan-14: $412,820
PRICE PER SQUARE FOOT
January 2015: $203, Down 3.5% MTM, Up 1.8% YTY
$0
$50
$100
$150
$200
$250
$300
$350
$400
Jan
-07
Ap
r-0
7
Jul-
07
Oct
-07
Jan
-08
Ap
r-0
8
Jul-
08
Oct
-08
Jan
-09
Ap
r-0
9
Jul-
09
Oct
-09
Jan
-10
Ap
r-10
Jul-
10
Oct
-10
Jan
-11
Ap
r-11
Jul-
11
Oct
-11
Jan
-12
Ap
r-12
Jul-
12
Oct
-12
Jan
-13
Ap
r-13
Jul-
13
Oct
-13
Jan
-14
Ap
r-14
Jul-
14
Oct
-14
Jan
-15
PRICE PER SQ. FT.
SERIES: Median Price Per Square FeetSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
INVENTORY IMPROVING FROM LAST YEAR
Jan 2014: 4.3 Months; Jan 2015: 5.0 Months
Note: “Unsold Inventory Index” represents the number of months it would take to sell the remaining inventory for the month in question. The remaining inventory for the month is defined as the number of properties that were “Active”, “Pending”, and “Contingent” (when available) and divide the sum by the number of “Sold” properties for the month in question.
0
2
4
6
8
10
12
14
16
18
Jan
-05
Jul-
05
Jan
-…
Jul-
06
Jan
-07
Jul-
07
Jan
-…
Jul-
08
Jan
-…
Jul-
09
Jan
-10
Jul-
10
Jan
-11
Jul-
11
Jan
-12
Jul-
12
Jan
-13
Jul-
13
Jan
-14
Jul-
14
Jan
-15
SERIES: Unsold Inventory Index of Existing Single Family HomesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
UNSOLD INVENTORY INDEX (MONTHS)
Note: “Unsold Inventory Index” represents the number of months it would take to sell the remaining inventory for the month in question. The remaining inventory for the month is defined as the number of properties that were “Active”, “Pending”, and “Contingent” (when available) and divide the sum by the number of “Sold” properties for the month in question.
Price Range (Thousand) Jan-15 Dec-14 Jan-14
$1,000K+ 7.6 4.3 6.9
$750-999K 5.5 3.1 5.0
$500-749K 4.9 3.0 4.1
$400-499K 4.7 3.0 4.0
$300-399K 4.9 3.2 4.0
$200-299K 4.5 3.3 4.0
$0-199K 4.5 3.4 4.0
SERIES: Unsold Inventory Index of Existing Single Family HomesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
WHAT HAPPENED TO ALL THE INVENTORY?
– Investors renting instead of flipping–Mortgage Lock-In Effect–Where will I go?–Foreclosure pipeline is dry –New construction up but still LOW– Off- MLS (aka “pocket’) listings not
being counted in listing stats
HOUSING AFFORDABILITY & HOME OWNERSHIP
WHERE ARE WE HEADED?
“…By 2025, California will have a middle class of renters.”
John Husing, Ph.D Economics
• Housing market is under-preforming given fundamentals
– Low mortgage rates
– Job & Income growth are back
• And yet…
– Sales off 7.6% in 2014 compared to 2013
– Share of first-time buyers LOW
– Affordability key concern for renters
2015 - WHERE ARE WE TODAY?
• Housing supply constrained in long-run– New construction recovery is very slow
– Missing 165,000+ new units per year
– Production has fallen short of housing needs
• Inhibited by– Fiscal interests of local government
– Residents who disdain further development, especially multi-family
– Unfavorable legal/business environment for development in general & multi-family in particular
INADEQUATE HOUSING SUPPLY ISSUE
CALIFORNIA’S 3 HOUSING GAPS
• Housing Gaps:
– Housing affordability gap
– Homeownership gap
– Housing production gap
• Chronic problems spanning decades
SHARE OF FIRST-TIME BUYERS UP IN ’14 BUT STILL BELOW LONG-RUN AVERAGE
28.1%30.5%
0%
10%
20%
30%
40%
50%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
% First-Time Home Buyers Long Run Average
Long Run Average = 38%
QUESTION: Was the buyer a first-time buyer?SERIES: 2014 Housing Market SurveySOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
HOUSING AFFORDABILITY DOWNSHARPLY SINCE Q1 2012
California vs. U.S. – 1984-2014% OF HOUSEHOLDS THAT CAN BUY A MEDIAN-PRICED HOME
SERIES: Housing Affordability Index of Traditional BuyersSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
0%
10%
20%
30%
40%
50%
60%
70%
80% CA USAnnual Quarterly
HOUSING AFFORDABILITY IN CA: BY COUNTY
SERIES: Housing Affordability IndexSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
HAI
64
59 57 56 5653 53
50 4945
41
31 29 29 28 27 27 26 24 23 22 21 21 2017 15 15 14
0
10
20
30
40
50
60
70
% able to purchase median priced home
2014 Q4
INCOME REQUIRED TO BUY A MEDIAN-PRICED HOME IN CA: (PEAK VS. CURRENT)
$56,324
$93,593
$0
$20,000
$40,000
$60,000
$80,000
$100,000
2012 Q1 2014 Q2
• Change in minimum required income: $37,269
• Increase in income attributed to interest rate increase: $836 (2.2% of total change)
• Increase in income attributed to price increase : $36,433 (97.8% of total change)
SERIES: Housing Affordability IndexSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
VERY SLOW REAL INCOME GROWTH
$0.00
$10,000.00
$20,000.00
$30,000.00
$40,000.00
$50,000.00
$60,000.00
$70,000.00
198
4
198
5
198
6
198
7
198
8
198
9
199
0
199
1
199
2
199
3
199
4
199
5
199
6
199
7
199
8
199
9
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
U.S. CAIn 2013 Dollars
SERIES: Median Household IncomeSOURCE: US Census Bureau, Current Population Survey
2013 gap = $5600
HOMEOWNERSHIP RATE FALLING
California Vs. U.S.
53.7%
Peak: 60.2%
54.9%
64.5%
Peak: 69.0%
64.8%
40%
45%
50%
55%
60%
65%
70%
75% CA US
SERIES: Homeownership RatesSOURCE: U.S. Census Bureau
MILLENNIAL HOMEOWNERSHIP FALLING
SOURCE: Census Bureau
$-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000 California US
CA PRICES UPWARD MARCH WILL SLOW
1970-2014
SOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
SERIES: Median Price of Existing Single Family HomesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
CA V. US PRICE GAP: $10K TO $246K
1970-2014
SOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
$-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000 California US
$10K to $246
SERIES: Median Price of Existing Single Family HomesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
2014 Dollar Value
STUDENT LOAN DEBT:25% OF RENTERS
Yes, 23%
No, 75%
Refused, 2%
Student Loan Debt
SERIES: 2013 Renter SurveySOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
78%
8%
6%
3%
2%
2%
<$10,000
$10-$20K
$20-$50K
$50-$100K
> $100K
Refused
Amount of Debt
STUDENT DEBT: DRAGS ON HOME SALES
CA PERMITS UP BUT MORE UNITS NEEDED
2013: 57,496 Units, Up 43.0% from 2012
SERIES: New Housing PermitsSOURCE: Construction Industry Research Board
0
50000
100000
150000
200000
250000
300000
350000 Single Family Multi-Family
Household Growth: 165,000/yr
REASONS FOR RENTING INSTEAD OF BUYING
44%
9%
6%
6%
6%
5%
5%
3%
2%
Can't afford to buy
Poor credit / Can't qualify
Renting is easier
Young/Starting out/Not ready
Flexibility/Freedom if renting
Cost/Upkeep/Responsibility
Plan to / Saving for down
Never considered it/No interest
Disabled/On disability
SERIES: 2013 Renter SurveySOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
DOWN PAYMENT RESOURCE DIRECTORY
Down Payment Resource™Homeownership Program Index’s
Key Findings:
Over 300 programs in California
59% provide direct down payment &
closing cost assistance
10% provide mortgage credit up to
$2,000 for the life of the loan
26% are available to repeat buyers
There are hundreds of homeownership programs
available to help motivate buyers. Visit
downpayment.car.org to find them.
PEOPLE WOULD PREFER THE FOLLOWING OVER GOING THROUGH THE HOME MORTGAGE PROCESS AGAIN:
SOURCE: Guaranteed Rate Mortgage Survey of 1,000 adults 25 and older USA Today April 2014
2015 FORECAST
CALIFORNIA HOUSING MARKET OUTLOOK
2009 2010 2011 2012 2013 2014 2015f
SFH Resales (000s) 474.9 416.5 422.6 439.8 414.9 383.3 402.5
% Change 24.5% -12.3% 1.4% 4.1% -5.9% -7.6% 5.0%
Median Price ($000s) $275.0 $305.0 $286.0 $319.3 $407.2 $447.0 $478.7
% Change -21.1% 10.9% -6.2% 11.6% 27.5% 9.8% 7.1%
Housing Affordability
Index 51% 48% 53% 51% 36% 30% 27%
30-Yr FRM 5.0% 4.7% 4.5% 3.7% 4.0% 4.3% 4.5%
SERIES: CA Housing Market OutlookSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
INTERNATIONAL BUYERSMAKE THEIR MARK
1/3 FROM CHINA
Please tell us about your last closed transaction with an international client. What is your client’s country of permanent residence?
3.8%
4.7%
8.3%
14%
35%
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%
India
Japan
Mexico
Canada
China/Hong Kong
WHY INTERNATIONAL CLIENTS BUY
5%
5%
5%
7%
12%
14%
18%
0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20%
Investment to acquire legal permenant U.S.resident status
Tired of renting
Affordable price
Desired a better/other location
Changed jobs/relocated
To rent out property
Investment/tax advantages in U.S.
What was your clients’ main reason for buying/selling now in your last closed transaction with an international client?
INTENDED USE FOR PROPERTY? HOME
4%
27%
38%
30%
0%
2%
7%
91%
0% 20% 40% 60% 80% 100%
Other
Vacation/Second Home
Investment/Rental Property
Primary Residence
US Buyer
International Buyer
What was the intended use of the property in your last closed transaction with an international client?
ALL CASH INTERNATIONAL BUYERS
0%
20%
40%
60%
80%
100%
International buyers Traditional buyers
69%
27%
31%
73%
All cash Obtained financing
SOURCE: 2013 International Client Survey, 2013 Annual Housing Market SurveyHow did your last international buyer pay for the property?
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