International transactions surge 44% in pre-tariff period, marking first annual increase since 2017

Foreign investment in U.S. real estate has roared back to life, with international buyers completing 78,100 property transactions in the 12 months ending March 2025—a remarkable 44% increase from the previous year and the first annual uptick since 2017, according to new data from the National Association of Realtors (NAR).

The resurgence comes with a hefty price tag. International buyers paid a record average of $494,400 per property, driving total foreign real estate transactions to $56 billion—a 33.2% jump that underscores the premium these buyers are willing to pay for U.S. assets.

A Post-Pandemic Recovery

“International interest in purchasing U.S. real estate has increased following the global economic recovery, after several years of pandemic-related disruptions,” said Lawrence Yun, NAR’s chief economist. “Foreign buyers are attracted to U.S. real estate investments due to the strong protection our country offers for private property rights.”

The timing of this data proves particularly significant. The 12-month period measured by NAR concluded before President Donald Trump’s April announcement of new tariffs on foreign goods—what he termed “Liberation Day.” Real estate experts anticipate this policy shift could dramatically cool foreign investment, with Canadian buyers expected to be among the first affected.

Chinese Buyers Lead the Charge

Chinese nationals dominated foreign purchases, accounting for 15% of all international transactions, followed by Canadians at 13%. Mexican buyers represented 8% of foreign sales, while Indian and British buyers each claimed 6% and 4% respectively.

These buyers demonstrated a clear preference for premium properties and cash transactions. Nearly half (47%) of international buyers paid cash, compared to just 28% of all U.S. buyers—a trend NAR attributes partly to persistently high mortgage rates that make financing less attractive for foreign investors.

Florida Maintains Its Crown

Florida continued its 15-year reign as the top destination for foreign real estate investment, capturing 21% of all international transactions. “Florida remains the primary destination for foreign buyers, a trend that has lasted at least 15 years,” Yun noted.

California secured second place, followed by Texas, New York, and Arizona. The geographic concentration reflects foreign buyers’ preference for established markets with strong property rights protections and robust resale potential.

Challenges Ahead

Despite the impressive growth, transaction volumes remain below pre-pandemic levels. “High home prices and interest rates continue to constrain potential sales activity and remain well below pre-pandemic levels,” Yun cautioned.

The foreign buyer surge occurs against a backdrop of broader U.S. housing market challenges, including inventory shortages and affordability concerns that have priced out many domestic buyers. International investors, with their higher cash reserves and willingness to pay premium prices, have found opportunities that others cannot access.

Policy Implications

The data’s timing—captured before Trump’s tariff announcements—provides a baseline for measuring how trade policy affects real estate investment patterns. Industry observers expect the next NAR report to show markedly different trends as international buyers reassess their U.S. investment strategies in light of evolving trade relationships.

For now, the numbers tell a story of renewed confidence in U.S. real estate as a stable, profitable investment vehicle. Whether that confidence survives the new policy environment remains an open question that could reshape international investment flows for years to come.

Source: Idealista