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The U.S. housing market is undergoing a recovery that was in part propelled by enthusiastic participation of foreign buyers who flocked to the country to take advantage of globally competitive real estate prices. Data show that four areas in particular have attracted the greatest amount of attention from foreign buyers: Arizona, Texas, California and Florida. It’s no coincidence that these are share common qualities like fair weather, coastal property and a once overly beleaguered market; factors that helped attract both foreign and domestic investors, and ultimately act as a catalyst for a larger national recovery. For more on this continue reading the following article from TheStreet

Wealthy foreigners from around the globe are taking advantage of America's housing bust to snap up U.S. properties at cut-rate prices -- helping the market rebound in the process.

"We've seen [foreign investors] buy $10 million to $20 million worth of houses in a single trip," says Peter Loewy, CEO of Los Angeles-based Teles Properties. "They think this is a good place to park money, and it's less expensive than the real estate back home."

A recent National Association of Realtors study estimated that foreigners and immigrants who've lived here less than two years spent $82.5 billion on U.S. homes in the 12 months ended March 31. That's about 9% of the total paid for all U.S. housing purchases during the period.

The NAR also found that foreigners spent more on average -- $400,000 per property vs. $252,000 for the overall market -- and paid cash for homes 62% of the time instead of taking out mortgages.

"Foreigners have been a good source of sales, and they're providing both stability in the market and some tendency toward a more normal price appreciation," report co-author Jed Smith says.

Smith and his colleagues say foreigners and recent immigrants are diving into U.S. real estate because buyers consider housing here a good investment and see America as a safe haven for assets.

Many also need a place here for business trips, vacations or retirement or expect their children to study at U.S. colleges and need housing.

Additionally, some foreigners buy property in conjunction with buying U.S. businesses. That's because anyone who invests $1 million in a U.S. company and creates 10 jobs can qualify for an "EB-5" visa and eventual citizenship. (The requirement drops to $500,000 if you invest in a depressed U.S. locale.)

Texas Realtor Alston Boyd says lots of wealthy Mexicans are using the EB-5 program to relocate their families from crime-ridden areas south of the border.

"It's mostly driven by people wanting safety for themselves and their families, particularly in areas where there's a danger of kidnapping," says Boyd, who leads the Texas Association of Realtors' international-sales committee.

In fact, the NAR found that Mexicans accounted for 8% of all sales to foreigners and recent immigrants during the 12-month period studied.

Other top sources for foreign buyers included Canada (24% of all sales to non-U.S. nationals), China (11%), India (6%) and Britain (6%).

Buyers from different countries favor different parts of America.

For instance, the NAR found that lots of Germans have bought property in southwest Florida, while many Canadians gravitate toward Arizona.

Researchers attribute the variations to a given locale's closeness to a buyer's home country, coupled with word-of-mouth recommendations among buyers from the same nation.

Here's a look at the four states the NAR found are most popular with foreign and recent-immigrant buyers. All percentages refer to home sales made during the 12 months ended March 31. 

Arizona?
Foreigners and recent immigrants account for 7% of all Arizona home purchases, with Canadian vacation- and retirement-home buyers leading the way.

"We see Canadians come here just to get away from the cold weather," says Jodi Kevern of Arizona Focus Realty, which specializes in working with buyers from the Great White North.

Kevern says buyers from Canada's western provinces flock to Arizona because the state has a mild climate, lower prices than the West Coast and a location just 2.5 hours from Alberta by plane.

She considers the Canadians a godsend for the Grand Canyon State -- and for her own neighborhood, where they've turned several run-down, foreclosed properties into well-maintained vacation homes.

"The houses may be still vacant for much of the year, but at least they're taken care of instead of having weeds 5 feet high," Kevern says. "It's boosting all of our property values." 

Texas?
Foreign and new-immigrant buyers are buying 7% of all Texas properties sold.

"What we're seeing is a very different kind of Mexican [buyer]," says real estate broker Alston Boyd, who owns Austin-based Boyd & Boyd. "We used to have so many [low-income] workers coming north, but now we have wealthy Mexicans buying homes and investment properties."

Boyd says Mexican elites are buying homes in Houston, San Antonio and other Texas locales to avoid crime sweeping some Mexican cities, particularly northern towns near the U.S. border.

"I don't want to completely blacken the name of Mexico, because there are places there that are very safe," he says. "But there are other places that are not safe."

Boyd says the added demand is giving the Lone Star State's housing market a Texas-sized boost.

"Any time you have 7% more investment in any market, that's going to help a great deal," he says. 

California?
Property buyers from Australia, China, South Korea, Japan and India are streaming into California, where foreigners account for 11% of all home sales.

"[California] ends up being kind of the gateway to the United States for the South Pacific," says Sharran Srivatsaa, president of L.A.'s Teles Properties.

He says foreign buyers love the Golden State's climate and Hollywood image -- not to mention recession-reduced home prices far below what foreigners pay back home.

"It's easier to find a $1 million or $2 million property that's a good value in Los Angeles than it is in Melbourne or Sydney," Srivatsaa says.

Many foreign buyers gravitate to famous California communities such as Beverly Hills, Bel Air or Pebble Beach.

But Teles CEO Loewy says some Chinese buyers prefer Alhambra, Pasadena, San Francisco and other areas with large Chinese populations.

"We have a fair number of Chinese neighborhoods where you can walk down the street and see Chinese shops and people reading Chinese-language newspapers," he says. "It gives [some Chinese buyers] an extra sense of comfort."

Either way, Loewy says foreign buyers are really helping the state's long-struggling housing market rebound.

"[Foreigners] have to some extent helped the ability of people to 'move up' in the market, and we're starting to see high-end luxury homes really sell way faster," he says. 

Florida?
Foreign buyers and recent immigrants account for 26% of all Sunshine State home sales -- the largest proportion for any state.

Matey Veissi of Miami's Veissi & Associates says most foreign buyers hail from Latin America or Europe, drawn by Florida's nice climate and close proximity to their homelands, plus America's economic stability.

"Buying a piece of Florida real estate is like opening a savings account for [many foreign buyers]," she says. "They know they're putting their money some place where they can get it when they need it."

Veissi, who estimates foreign buyers make up about 40% of her business, says clients from different countries seem to favor specific Sunshine State locales.

For instance, she says Brazilian buyers like the nightlife and nice beaches of the Gulf Coast's big cities, while French customers focus on Miami, Sarasota and mid-Florida. (British and Canadian buyers seem happy to move anywhere in the state "just to get away from the cold," Veissi says.)

The Realtor adds that foreigners are definitely helping to pull Florida housing out of the doldrums.

"We've always had international buyers coming in," Veissi says, "but now they're coming in in droves."

This article was republished with permission from TheStreet.